Congress approves final changes to health plan

Reporting from Washington — 

After a final surge to overcome Republican opposition, congressional Democrats approved the last piece of their healthcare overhaul Thursday night, sending President Obama a package of changes to the landmark legislation he signed Tuesday.

The so-called reconciliation package, which includes a major reorganization of the federal student loan program, passed the Senate on Thursday on a nearly party-line vote, 56 to 43. The end came after a grueling night and day of roll-call votes as Republicans sought to derail the bill.

House Democrats approved the same package Thursday evening, 220 to 207, formally concluding the tortuous 14-month drive to move major healthcare legislation through Congress for the first time since Medicare’s creation in 1965.

“Franklin Roosevelt identified four freedoms: freedom of religion, freedom of speech, freedom from want, and freedom from fear,” said Sen. Christopher J. Dodd (D-Conn.), one of the architects of the healthcare overhaul.

“Today in many ways we are fulfilling that last of the great freedoms, the fear that you or your family could suffer a healthcare crisis.”

The president, who traveled to Iowa on Thursday to tout the healthcare overhaul, is expected to the sign the bill in the next several days.

Paralleling earlier healthcare votes this year, not a single Republican voted for the final package in the House or Senate.

Many GOP lawmakers have criticized the legislation as an unwarranted expansion of federal authority over healthcare. And Thursday, Republicans kept up their call to roll back the legislation, previewing a heated debate that is expected to intensify as election day approaches this fall.

“The important thing now . . . is to replace those who voted for the healthcare bill and to repeal it when we get some new members here,” Sen. Jim DeMint (R-S.C.) told Fox News Channel’s Sean Hannity.

Three Democrats in the Senate and 32 in the House voted against the package Thursday. Sens. Blanche Lincoln and Mark Pryor of Arkansas and Ben Nelson of Nebraska joined 40 Republicans. Sen. Johnny Isakson (R-Ga.) is hospitalized and did not vote.

The bill needed only a simple majority in the Senate because Democrats used the budget reconciliation process to avoid a filibuster, which requires a 60-vote supermajority to quash.

The 153-page reconciliation package represents a small fraction of the gargantuan healthcare legislation that the House approved over the weekend and the president signed Tuesday.

But it makes several major changes to the main healthcare bill, including expanding subsidies that the federal government will provide to low- and moderate-income Americans starting in 2014 to help them buy health insurance.

The package also scales back a new 40% excise tax on high-end “Cadillac” insurance plans and delays the tax until 2018.

It imposes a new levy on couples making more than $250,000, who will pay a 3.8% Medicare tax on capital gains and other investment income for the first time.

The bill boosts federal aid to states to help them expand their Medicaid programs, replacing a provision in the main healthcare bill that singled out Nebraska for special assistance.

And it would gradually close the gap in Medicare prescription coverage known as the “doughnut hole,” which forces millions of seniors to pay thousands of dollars for medications out of their own pockets. Within a year, beneficiaries whose initial drug benefits ran out would receive a $250 rebate, and by 2020, the doughnut hole would be gone.

Together, the reconciliation package and the healthcare legislation are expected to cover an additional 32 million Americans by 2019, boosting the percentage of non-elderly Americans with insurance to 94% from 83%, according to estimates by the nonpartisan Congressional Budget Office.

The legislation also establishes a broad new framework of government regulation to prevent insurance companies from denying coverage to people who are sick and to require insurers to provide a minimum level of benefits.

The coverage expansion would not be cheap, requiring an estimated $938 billion over the next decade to expand Medicaid, give tax credits to small businesses to help them cover their employees, and provide insurance subsidies to many Americans who do not get benefits at work.

For the first time, most Americans will be required to carry health insurance or pay a penalty.

Because the cost of expanding coverage is offset by new taxes and cuts in what Medicare will pay insurers, hospitals and other providers over the next decade, the Congressional Budget Office estimated that the legislation will reduce the deficit slightly by 2019 by an estimated $143 billion.

Republicans have repeatedly criticized the new taxes and Medicare cuts.

And over a day and half of almost continuous voting on amendments, GOP senators tried to get Democrats to remove sections of the bill designed to raise revenue to pay for the legislation.

In the end, however, a provision unrelated to healthcare almost tripped up the measure.

The reconciliation bill includes a major change in the way the federal government helps students pay for college, giving the government authority to lend money to students directly instead of using private financial institutions as intermediaries. The student loan section of the legislation would use part of the projected savings from this change to expand the Pell Grant program for low-income students.

But early Thursday morning, Republicans successfully objected on parliamentary grounds to a minor provision designed to prevent the Pell Grants from decreasing in periods of deflation. The provision did not reduce the deficit, as required by the budget rules.

That forced Democrats to change the package, which in turn forced the House to take it up again Thursday even though the chamber had approved an earlier version Sunday.

A spokeswoman for the House Education and Labor Committee said Democrats may add the provision to legislation in the future if there were any signs of deflation.

noam.levey@latimes.com