Republicans blast 'bait and switch' health bill

Digging in for a long struggle, Republican senators and governors assailed the Democrats' newly minted health care legislation Thursday as a collection of tax increases, Medicare cuts and heavy new burdens for deficit-ridden states.

Despite the criticism, there were growing indications Democrats would prevail on an initial Senate showdown set for Saturday night, and Majority Leader Harry Reid crisply rebutted the Republican charges. The bill "will save lives, save money and save Medicare," he said.

The legislation is designed to answer President Barack Obama's call to expand coverage, end industry practices such as denying coverage on the basis of pre-existing medical conditions, and restrain the growth of health care spending.

Republicans saw little to like.

"It makes no sense at all and affronts common sense," said Sen. Judd Gregg of New Hampshire, one of several Republicans to criticize the measure. He added that a plan to expand Medicaid, the state-federal program for the poor, was a "bait and switch" with states as the victims.

GOP governors, meeting in Texas, agreed. "We all know a sucker play when we see one," said Mitch Daniels of Indiana. The bill would expand the Medicaid program, which provides health care for the poor, and leave the states with part of the additional cost beginning after three years.

In the Capitol, Reid answered Republican delaying tactics with an initial test vote set for Saturday evening. A 60-vote majority is required to advance the bill toward full debate, expected to begin after Thanksgiving.

Counting two independents, Democrats control 60 Senate seats. Three moderate Democrats have been cagey about their intentions, although none of them has announced a plan to defect. Officials disclosed during the day that Reid had included in the bill a political sweetener for one of the three, Mary Landrieu of Louisiana, in the form of $100 million to help her state cover health care costs for the poor.

While the struggle was forming, there were limits. Sen. Tom Coburn, R-Okla., backed off his threat to force the 2,074-page bill to be read aloud in the Senate chamber, a move that would have eaten into the Senate's Thanksgiving-week vacation.

Given the political stakes, there was disagreement even about the bill's cost.

Democrats put the price tag of the 2,074-page measure at $979 billion, higher than the $849 billion figure they had cited Wednesday as the cost of expanding coverage to 31 million who now lack insurance. Republicans calculated it at more like $1.5 trillion over a decade, and said even that was understated because Reid decided to delay implementation of some of the bill's main features until 2014.

Officially, the Congressional Budget Office said the measure would reduce deficits by $130 billion over the next decade with probable small reductions in the 10 years that follow - forecasts that cheered rank-and-file Democrats. Among the cost-cutting provisions would be creation of an Independent Medicare Advisory Board which could be required to recommend steps limiting the growth of the program that provides health care to millions of seniors. The recommendations would go into effect automatically unless Congress blocked them.

CBO Director Douglas Elmendorf has said previously that type of arrangement would be one of the most potent weapons Congress would have to restrain the growth of Medicare, a fast-expanding program supported in part by a trust fund that is dwindling.

But CBO also cautioned the bill includes "a number of procedures that might be difficult to maintain over a long period of time."

The Democrats' cost estimates of slightly below $1 trillion was considerably smaller than a House-passed bill's price tag of between $1.2 trillion to $1.3 trillion.

In part to reduce costs, the legislation would delay until Jan. 1, 2014, creation of so-called insurance exchanges in which individuals and small businesses could shop for affordable coverage. The House would set up its version of the exchange one year earlier.

Both bills would allow consumers to choose between private insurance policies and coverage sold by the government.

The two bills also include billions of dollars in subsidies to help lower-income Americans afford the cost of coverage.

Under the Senate measure, CBO figures show about 19 million people would receive subsidies averaging $5,500 in 2019, at the end of the decade. By comparison, the House bill is projected to provide subsidies to 18 million, an average of $6,800.

Republicans said little if anything about subsidies during the day, instead focusing much of their criticism the bill's tax increases and its curbs in Medicare spending.

Democrats included a new tax on high-value insurance policies, an attempt not only to raise money but also to dampen the appetite for costly coverage. In addition, Reid included a payroll tax increase of .5 percentage point on income greater for $200,000 for individuals and $250,000 for couples. Medical device manufacturers, insurance companies, drug makers and recipients of elective cosmetic surgery would also face new or higher taxes.

About half of the bill Reid unveiled Wednesday would be financed by curbs in projected Medicare spending. While providers such as home health care agencies would absorb some of that, the biggest blow would fall on private Medicare plans. Studies show the government pays about 14 percent more to cover patients enrolled in those plans than in the traditional Medicare program.

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Associated Press writers Ricardo Alonso-Zaldivar and Erica Werner in Washington and Liz Sidoti in Austin, Texas, contributed to this story.