Healthcare overhaul one step closer to completion

The drive to enact President Obama’s sweeping healthcare overhaul entered its final phase with today’s passage of the Senate bill, but hardened differences with the House -- over abortion, taxes and the government’s role in the insurance market -- remain to be resolved.

While Congress will not reconvene until mid-January, efforts to reconcile the two versions of the bill are underway on an informal level, and Senate Finance Committee Chairman Max Baucus (D-Mont.) said they would continue next week.

The 60-39 vote on strict party lines came in an unusual Christmas Eve session, with exhausted senators gathering at 7 a.m. It was the 25th day of debate, and Vice President Joe Biden -- who by law serves as the chamber’s president -- made a rare appearance to oversee the roll call.

“With today’s vote, we are now incredibly close to making health insurance reform a reality in this country,” Obama said. “Our challenge, then, is to finish the job. We can’t doom another generation of Americans to soaring costs and eroding coverage.”

The bill that goes back to the House and Senate for a vote almost certainly will increase the number of people covered by government and private insurance by at least 30 million.

It will require most individuals to buy coverage, offer federal subsidies to help pay premiums, impose penalties on employers that do not offer affordable policies and set up an insurance marketplace for individuals without job-based coverage.

It will not, however, include a government-run insurance program.

In addition, insurers no longer will be able to deny coverage based on pre-existing medical conditions or set a lifetime cap on benefits. Young adults will be able to stay on their parents’ plan longer, and families’ preventive healthcare -- such as well-baby visits and mammograms -- will be 100% covered.

The price of changing how America gets its healthcare would, under the Senate bill, cost $871 billion over 10 years. However, tax increases and spending cuts called for in the legislation would end up reducing the federal deficit over time.

“This is a victory because we’ve affirmed that the ability to live a healthy life in this great country is a right, not a privilege,” said Senate Majority Leader Harry Reid (D-Nev.).

Despite bipartisan consensus that the nation’s current healthcare system was unacceptable, debate in the Senate was especially bitter, personal and partisan.

Not a single Republican voted for the bill; the only one who did not cast a “no” vote was Sen. Jim Bunning (R-Ky.), who was absent because of family commitments, his office said. And GOP leaders did everything they could to delay the vote. They spent more than 80 hours in Senate floor speeches denouncing the Democrats’ bill as an expensive, ill-considered, pork-laden “monstrosity” that would do little to curb costs and rising insurance premiums.

Undaunted by the Christmas Eve vote, Republicans vowed to keep up the battle -- not just in Congress, but on the campaign trail during the 2010 mid-term elections.

“This fight isn’t over,” said Senate Republican Leader Mitch McConnell (R-Ky.). “I guarantee you the people who voted for this bill are going to get an earful when they finally get home for the first time since Thanksgiving. They know there is widespread opposition to this monstrosity.”

Underscoring the drama, senators cast their votes from their desks on the Senate floor -- a custom reserved for the most momentous occasions.

Watching from the public gallery were soldiers in the long battle for universal healthcare, such as Rep. John D. Dingell (D-Mich.). Also present was Victoria Kennedy, widow of the late Sen. Edward M. Kennedy (D-Mass.), a lifelong champion of universal healthcare who died of cancer in August.

“This is for my friend Ted Kennedy,” the ailing, 92-year-old Sen. Robert C. Byrd (D-W.Va.) said before casting his vote.

In a sign of exhaustion after weeks of round-the-clock work on the bill, Reid accidentally voted “no” when his turn came. As his colleagues burst into laughter, he threw up his hands and corrected the mistake.

“I spent a very restless night last night trying to figure out how I could show some bipartisanship,” he joked afterward. “I think I was able to accomplish that for a few minutes today.”

The outcome of the Senate vote had been all but certain since last weekend, when the last two holdouts in the Democratic caucus -- Sen. Ben Nelson of Nebraska and Sen. Joe Lieberman (I-Conn.) -- were persuaded to support the bill. That gave Democrats the 60 votes needed to break a threatened Republican filibuster.

Lieberman joined the effort after Reid dropped the most controversial part of the plan: a government-run “public option” that would compete with private companies to make premiums more affordable. Nelson held out for tighter restrictions on federal funding of abortions.

Those issues will have to be revisited in House-Senate negotiations to craft a compromise bill.

Typically, joint House-Senate conference committees are made up of the chairmen whose committees the bills passed through. In this case, that would mean Baucus, Sen. Tom Harkin (D-Iowa) and Reps. George Miller (D-Martinez), Henry A. Waxman (D-Beverly Hills), and Charles B. Rangel (D-N.Y.).

But as the Senate completed its work today, sentiments were growing on Capitol Hill that a formal conference may not be necessary.

Since Democrats see no hope of attracting GOP support, it is possible that a handful of leaders from both chambers -- and perhaps some key committee chairs -- would hammer out a deal behind closed doors.

Members of the Obama administration also will be heavily involved in the talks.

“We’ve got two bills, one in the House, one in the Senate; they’re 95% similar,” White House Deputy Press Secretary Bill Burton said. “We’re going to be actively working to iron out the rest of the differences and get a bill passed and signed.”

One of the thorniest issues is abortion.

Language in the House bill, drafted by Rep. Bart Stupak (D-Mich.), would prohibit anyone receiving federal premium subsidies from buying a policy through the insurance exchange that covers abortion. The Senate bill would prohibit the use of federal funds for such coverage, requiring insurers to segregate public and private funds to assure that. Stupak has pledged to fight the less-restrictive Senate language, but it was unclear how many anti-abortion Democrats would vote against the entire bill over that issue.

Another politically explosive question is how to raise revenues to pay for new healthcare programs.

The Senate bill would impose a 40% excise tax on high-cost insurance plans -- a tax that analysts predict would be passed on to consumers in higher premiums or reduced benefits. That “Cadillac tax” is a deal-breaker for labor unions, which argue that workers have given up wage increases in exchange for negotiating generous benefit packages. But advocates of the Cadillac tax say it will help contain healthcare costs by discouraging companies and employers from offering high-end plans.

The House bill would pay for its plan by imposing an income tax surcharge of up to 5.4% on individuals making more than $500,000 and families making more than $1 million.

In a Wednesday conference call of House Democrats to discuss the upcoming negotiations, some lawmakers reportedly expressed anger at the presumption that they would accede to the Cadillac tax and other Senate concessions in order to appease conservatives.

According to sources who participated in the call and requested anonymity when discussing party strategy, House Speaker Nancy Pelosi (D-San Francisco) assured her rank and file that the House would not just rubber stamp the Senate bill.

Among the issues House Democrats may try to insist on, a leadership aide said, was having premium subsidies and insurance exchanges take effect in 2013; the Senate’s start date for many key provisions is 2014. House Democrats also want to increase federal premium subsidies for low- and middle-income people over Senate levels, and make the exchanges a national marketplace rather than the state-based programs the Senate wants.

But if the Senate prevails on key points, the compromise bill may be more appealing to conservative Democrats.

Lawmakers hope to send a final bill to the White House before Obama delivers his State of the Union address in late January or early February, but they say it probably will take a bit longer.

James Oliphant in the Washington Bureau contributed to this report.