Parties trade shots over health-care bill

WASHINGTON — Democrats and Republicans formed clear battle lines Tuesday as the Senate Finance Committee opened a high-stakes debate over health-care legislation proposed last week by the panel's chairman.

Both sides found plenty to criticize in Sen. Max Baucus' bill, particularly its requirement that all U.S. citizens must buy health insurance at potentially high costs.

Arizona Sen. Jon Kyl, a member of the committee and the Senate's No. 2 Republican, called the bill "a stunning assault on liberty" that would lead to higher taxes and less consumer choice.

But Baucus, D-Mont., defended his work and urged colleagues to "do our part to make quality, affordable health care available to all Americans."

Republicans outlined a series of specific provisions that they would seek to change or eliminate as the panel debates 564 amendments, a discussion that could stretch into next week. One target-rich area: the more than $500 billion in Medicare changes that the bill proposes, to squeeze waste from the elderly insurance program. Another is the fine that the bill would impose on U.S. citizens who don't buy health insurance, which the GOP describes as a tax on the middle class. And they warn that the bill's hefty new industry fees would be passed on to consumers.

Some Democrats, meanwhile, said they would press to reduce costs further for millions of Americans who would be required to purchase health coverage.

Baucus revised his bill even before submitting it to the committee Tuesday, adding more aid for middle-class families and watering down a tax provision that could target a small number of union households.

His changes drew praise from some Democrats and from Sen. Olympia Snowe, R-Maine.

"This is a solid starting point, but we are far from the finish line," said Snowe.

Baucus' bill would help extend health insurance to an estimated 94 percent of Americans, including 29 million individuals who currently have none. An estimated 11 million people would join Medicaid under the legislation, and 25 million others would gain access to a new private-insurance exchange, including 7 million people who currently purchase their plans or pay for coverage through their employers.

Democrats' primary concern with the Baucus bill is that it would not adequately subsidize working-class and middle-class households, who could be required to pay between 2 percent and 12 percent of their income toward insurance premiums. After Baucus' revisions, no individual who receives coverage through the insurance exchange would pay more than $3,987 a year for deductibles and co-payments; families' out-of-pocket costs would be capped at $7,973.

His changes also would make it easier for people whose employers offer unaffordable coverage to join the exchanges. And he would lower premium costs for older policyholders: While his original proposal would have permitted insurance companies to charge people in their early 60s as much as seven times more than younger customers, his modified bill would bar them from charging seniors more than four times the lowest policy cost.

Facing complaints about his primary source of revenue for the package — a tax on high-cost "Cadillac" insurance policies — Baucus also has proposed adjustments. He would increase the tax from 35 percent to 40 percent, but apply it to fewer policies, carving out exceptions for non-Medicare retirees, people with high-risk jobs and others who pay higher premiums because of their age or occupation, not because their benefits are particularly generous.

Washington Post reporters Ceci Connolly and Michael A. Fletcher contributed to this report, which also contains material from Tribune Newspapers.