Senate Softening Regulatory Sting of Health Bill

The Senate unanimously backed a Republican move Wednesday night to scale back government powers in a Clinton Administration-backed health care reform bill, killing a proposed $10,000-per-employee fine against companies that fail to offer workers a choice of plans.

The 100-0 vote was just one of many unmistakable signs that the bill introduced by Senate Majority Leader George J. Mitchell (D-Me.) will be subjected to bipartisan efforts to delete provisions that many regard as excessive government bureaucracy and regulation.

As early as today, a group of about 20 moderate senators from both parties, known as the “mainstream coalition,” is expected to unveil a compromise proposal that would further reduce the role of government in a revamped health care system.

The surprising unanimous vote to delete the $10,000 fine came on an amendment offered by Sen. Don Nickles (R-Okla.), who urged members to “take away some of the heavy hammer” of government in Mitchell’s bill.

Democrats said they agreed to do so in part to foster a spirit of bipartisanship and in part because there are other provisions in the bill that would achieve the deterrent effect.

“There are other ways,” said Sen. Tom Daschle (D-S.D.). “We are certainly willing to try that approach in the spirit of bipartisanship.”

Mitchell added: “They said the penalty was excessive and unnecessary and we agreed to that.”

Despite the unanimous vote on the Nickles amendment Wednesday night, Mitchell and his Senate allies are bracing for what may be a long series of GOP amendments intended to cripple, if not kill, the Mitchell plan, which is favored by President Clinton and Democratic leaders.

Indeed, Nickles disclosed that he plans to offer--perhaps as early as today--more amendments, including one to kill a requirement in Mitchell’s plan for a standard benefits package that would be available to everyone.

Another amendment that Nickles is drafting would exempt all existing insurance policies from health reform legislation, a move that could render the reforms all but toothless.

The bustle in the Senate was a sharp contrast to the continuing delays in the House, which now may not take up health care reform until Sept. 8.

Earlier this month, the House Democratic leadership put off floor debate until the Congressional Budget Office had fully analyzed the four bills introduced in the House.

House Majority Leader Richard A. Gephardt (D-Mo.) told members Wednesday that if the Budget Office reports are still not ready after House action on the crime bill, the House would move into an informal session, allowing members to return to their districts, subject to being called back to Washington.

“We want to bring the bill up and pass it as soon as we can,” Gephardt said, speaking of the health reform bill he has introduced. “I don’t know (when) and I don’t know anybody who does.”

The Senate, after adopting Nickles’ amendment Wednesday, began debating a series of amendments offered by Daschle to enhance access to care in rural areas.

Late in the afternoon, the “mainstream coalition,” which includes Sen. Dianne Feinstein (D-Calif.), met in private to thrash out their consensus proposal. Members also met separately with Mitchell and Senate Minority Leader Bob Dole (R-Kan.).

“I believe there are many areas in which there can be accommodation and agreement,” Mitchell said afterward.

As the coalition meeting broke up, members said that the group has virtually reached agreement on all the major issues, including how to expand coverage while containing costs and reducing the role of government.

But they declined to reveal the specifics, noting that they were to meet this morning with Robert D. Reischauer, director of the Budget Office, to discuss their proposal.

The group, led by Sens. John H. Chafee (R-R.I.) and John B. Breaux (D-La.), is said to be trimming both the benefits and the scope of Mitchell’s bill. Coverage for outpatient prescription drugs and for long-term care--both proposed originally by Clinton--are likely to be scaled back, sources said.

Earlier in the day, Mitchell defended his plan from Republican attack on the floor of the Senate.

He accused his GOP colleagues of hypocrisy because of their denunciations of a “government-run” health care system while they take full advantage of the services offered by federal hospitals and doctors and willingly enroll in a federal health insurance program that pays 72% of their premiums.

Mitchell denied that his program amounts to a government-run system but he nevertheless urged citizens to ask themselves: “If it’s so bad for me, how come it’s so good for them (members of Congress) and their families?”

Also on Wednesday, five Republican senators, led by Mitch McConnell of Kentucky, denounced provisions in Mitchell’s bill that they said would lead to “an explosion in lawsuits” by overturning tort reforms that have been enacted by 22 states, including California.

They said that Mitchell’s bill would create new grounds on which employers and health plans could be sued, such as allegations of discrimination based on race, sexual orientation and age.

Sen. Phil Gramm (R-Tex.) said that Mitchell’s bill “is worse than nothing.”

Times staff writer Robert A. Rosenblatt contributed to this story.