Republicans Gird for Democrats' End Run on Health Care

Feb. 25: President Obama, House Speaker Nancy Pelosi, Vice President Joe Biden, Health and Human Services Kathleen Sebelius and Senate Minority Leader Mitch McConnell at health care summit. (AP)

The Senate appears to be gearing up to use a rare budgetary maneuver to push through a Democratic-supported health care overhaul, but even the Senate Democrat's top budgeter says it can't be used for wholesale reforms.

Sen. Kent Conrad, D-N.D., the chairman of the Senate Budget Committee, said the rules around "reconciliation" only allow for items that can be budgeted to be approved through the process that allows for a simple majority of 51 Senate votes.

"The major package of health care reform cannot move through the reconciliation process. It will not work," Conrad said on CBS' "Face the Nation."

"This whole bill cannot be passed on reconciliation. It would be the budget elements of the bill, with a simple majority vote," Sen. Bob Menendez, D-N.J., agreed on "Fox News Sunday."

Under the limitations of reconciliation, items like prohibiting insurance companies from denying coverage to those with pre-existing conditions, establishing health insurance exchanges or preventing lifetime caps on insurance are not covered under reconciliation.

But supporters of the legislation promoted by President Obama at a marathon health care summit last week say that's just what Americans roundly support.

"They want to end the preexisting conditions. They want to afford health insurance. ... And they want to stop the insurance company abuses," Menendez said on "Fox News Sunday."

Last Thursday's summit at Blair House in Washington, D.C., was a crystalline moment, say participants and observers, in that it demonstrated the philosophical differences between the parties on the role of government in health care reform. It also solidified the notion that most every elected official in Washington agrees something must be done to change the way people access health care.

But agreement ends there, and that's what's causing such angst. Democrats say that reconciliation will be used to cut taxes, expand small business insurance policies, reduce costs for the same plan Americans now have and decrease the deficit.

But big-ticket items like shifting Medicare revenues to fund a new program or expanding government payments to the states to use for Medicaid are exactly what the GOP opposes.

Rep. Paul Ryan, R-Wis., said the funding elements of the bill won't balance spending the way Democrats assert.

The Congressional Budget Office's claims for a $132 billion reduction in the deficit over 10 years is based on its inability to strip out aggravating details, he said, but much of the legislation that would be passed through reconciliation involves the double-counting that sends the package into the red.

"The legislation that's been put in front of them is full of smoke, mirrors and gimmicks. ... If you take all the double counting out of the bill, which the CBO can't do because that's the way it's put in front of them, this thing has a $460 billion deficit in the first 10 years, a $1.4 trillion deficit in the second 10 years," he said.

"Let me give you an example. It double counts Medicare cost savings. It double counts increased taxes for Social Security, increased premiums for this new CLASS Act. ... If you're going to say that all these Medicare cuts are improving the solvency of Medicare, which is what they say, then you can't use that money to spend on the creation of another government program."

Sen. Jon Kyl, R-Ariz., who appeared with Menendez, said reconciliation is not designed for the purpose of passing a massive new entitlement program. He said the tool is limited because it is designed as a budget balancing maneuver. Kyl added that Americans are "leery" of any bill that spends about $2.5 trillion over 10 years.

"The tax cuts that my friend Bob Menendez talks about are really direct subsidies to the insurance companies. There was a deal made with the insurance companies. We will force everybody to buy insurance and then we, the federal government, will pay you, insurance companies, directly. It's not a tax cut to people. The people never see the money," he said.

The limits of reconciliation also make it an inappropriate tool for passing a major overhaul, said Senate Minority Leader Mitch McConnell.

"Many of these insurance reforms we could pass on a bipartisan basis, but you wouldn't have to cut Medicare by half- a-trillion dollars, levy a half-a-trillion-dollar tax increase, put that on the side, and let's talk about insurance reform and legal reform, getting rid of junk lawsuits against doctors and hospitals. Those are the kinds of step-by-step reforms that we've been -- that we've been talking about," McConnell, R-Ky., said on CNN.

Republican Rep. Marsha Blackburn said her state of Tennessee already tried a similar idea with Medicaid and failed.

"We rolled the dice on this in Tennessee over a decade ago, made the gamble that near-term expenditures could be offset by long-term savings. Those savings never materialized," she said.

Conrad called the elements of reconciliation "side-car" items.

"The role for reconciliation would be very limited. It would be on side-car issues," Conrad said.

"Anything that doesn't score for budget purposes has to be eliminated. That would eliminate all the delivery system reform, all the insurance market reform, all of those things the experts tell us are really the most important parts of this bill," he said.

Even if Senate Democratic lawmakers do decide to go for the brass ring by using reconciliation, the legislation still has to be matched in the House of Representatives, and that's not a sure thing.

"I think their bigger problem is going to be in the House of Representatives where they basically don't have any votes to spare on a pure majority vote," Kyl said

The House passed a different version from the Senate last year on a 220-215 vote, but new vacancies and some representatives' refusal to go along with the Senate bill puts House Speaker Nancy Pelosi in a difficult position.

In an interview that aired Sunday Pelosi said that the time for talk is over, but determining the policy, learning what the Senate can achieve and then counting votes among House Democrats still have to take place. She declined to say whether she's got the votes to pass a new bill.

"We have a very diverse party, but we all agree that the present system is unsustainable. ... We cannot afford the rising cost of -- of health care," she said.