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Health Reform Summit Outcome: Insights & Talking Points
Source: Fred Hunt, President, SPBA, 2/26/2010, www.SPBATPA.org

Was the White House health reform summit a bust? Not really. It did not achieve its stated goal of being a bipartisan love fest, but none of the players ever expected that outcome. President Obama, who had said he would only be a moderator, ended up making most of the Democrat issue points and making most of the responses to Republican points. He spoke 119 minutes of the time. Other Democrats spoke an additional 114 minutes. (total 233 minutes for Democrats). The total time for Republicans to speak was 110 minutes.

The first hours of the Summit were the most insightful. It became obvious that Democrats define health reform via sad anecdotes that need to be cured, but do not explain exactly how their proposals would solve the problem A leap of faith is always needed to believe that the wishful thinking end result will automatically happen. It was also interesting in the start to watch that every time the Republicans would raise a problem and solution, the President and other Democrats would sincerely proclaim that they agree. They'd happily say that their bill(s) includes a solution. Again, this highlighted that the Democrats' disconnect that has frustrated Republicans and public opinion is not their sincere desire to help people; the problem is that they don't see why there should be a difference of opinion of the form and format of the solution (such as private pooling by small employers in self-funded plans, versus the solution of government exchanges or public option). This is where the true disagreement lies.

The Summit was a success for the President. He now gets to claim in broad generalization comments in speeches that he has extended his hand and sought participation from Republicans, and, similarly, he can now claim that health reform was done on TV. So he will look statesman-like to existing supporters, and he can dodge those earlier complaints that he was not living up to his campaign promises to be open.

Republicans "won" in that the Summit debate is seen as a draw, so the fact that they were serious, knowledgeable and courteous, plus they got to show that they have always had solid health reform proposals, and they did not get painted as the "party of no" is the "win" they sought.

Congressional Democrats were sort of like extras in the drama. However, that was fine, because they've been on the front lines of the battle thus far, and will carry the ball in the coming weeks..

The true purpose (target to be convinced) of the Summit was public opinion to assure and pressure moderate and hesitant Democrats that "the bill" (which one House, Senate, reconciliation, and/or Obama outline??) is good, it agrees with most of the goals the Republicans raised, so wavering Democrats should vote to make "it" (probably meaning pass a reconciliation bill with only 51% needed in the House and Senate, and then have the House pass the Senate mega bill as-is, and it gets signed by the President 24 hours later). So, for the next week or so, the Democratic leadership and White House will be polling and cajoling to see if they can rally enough votes for that. maybe even luring a Republican or two for political cover to call the end result bipartisan. That was the ultimate winning target of the Summit. Constituents should let Congressmen know the reelection impacts on the thousands of people they represent (such as people in TPA client plans). Most Congressmen truly want to know right now.

Will Obama/Reid/Pelosi be successful in achieving the needed numbers? All Democrats who have not been firmly in support of the bill are desperately trying to determine what their constituents' reaction will be if they vote for not only a mega bill that 2/3 of Americans say they don't like, but also doing it via the "sneaky" reconciliation route. In fairness to Democrats, Republicans have been the masters of using reconciliation for several major items over the years (such as COBRA and SCHIP), but this time, emotions are running high and voters are paying attention, so Democrats fear it will seem like a sneaky trick. There was no immediate stampede of persuaded moderates, but there will be some, so it is a close call.

Time FrameIt is a little confusing. The President offered to receive and consider Republican ideas for the next 6 weeks. However, the realistic timeline to use reconciliation is 4 weeks from now (Easter recess), and a reconciliation bill takes some procedural time by the Parliamentarian to be sure that each item impacts the Budget or it can not be in a reconciliation bill. Reconciliation bills are also subject to unlimited amendments, so that takes time and can muddy the legislative waters.

Targeted Bill ApproachThough the President and Democrat leaders made a big point that only a big comprehensive bill will achieve the needed goals, so Republicans should drop their idea of an incremental approach, Reid and Pelosi are already pursuing an incremental strategy of a series of small single-issue health reform bills, many of which will get bi-partisan support. (So, ironically, politically, if the mega-bill approach fizzles, the President and Democrats can suddenly shift their PR and say that they led and passed bipartisan "health reform". So, remember, in my very first health reform e-mail, I said that the President simply wants to claim a victory for something (anything) he can call health reform. Voila!

For example: The House already passed a bill to strip insurance companies of their McCarran-Ferguson anti-trust exemption (the same exemption that allows unionized employers to cooperate to create multi-employer Taft-Hartley plans). It passed with the major bi-partisan margin of 406-19.

What other single-issue bills can we expect?• Guarantee people not lose their health coverage when they lose their job. This is just a concept now. I'm guessing it would be COBRA-to-65 (as proposed occasionally in past years). I can hear employers, TPAs and Stop-Loss groaning, but at least it is recognizing and building on the successful private employee benefit system, not some grandiose governmental system.

• Allow children to stay on parental plans until mid-20s. Some actuaries say this would actually help employer plans by bringing younger participants. Also, this segment of young people constitutes about 15 million of the "uninsured", so solving this deflates much of the pressure for massive health reform.

• Prohibit insurers from dropping people when they get sick.

• Prohibiting pre-existing condition exclusions.

• Try to narrow or close the Medicare Part D "doughnut hole".Of course, this strategy of small targeted bills means that this will be an ongoing process.

So, again, Alice in Wonderland best summarizes the ever-shifting scenario. She said, "Things keep getting curiouser and curiouser."

About SPBASPBA is the national association of Third Party Administration (TPA) firms who provide comprehensive ongoing administrative services to client employee benefit plans. SPBA also has a Stop-Loss Service Partner category for carriers, MGUs, and re-insurers of self-funded health plans. Our members are firms, not individuals who are employed within a firm to handle employee benefits and human resources. Visit www.SPBATPA.org

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