The House Energy and Commerce Committee resumed and completed its markup of the Affordable Health Choices Act (H.R. 3200) last week after several days of intense negotiations with moderate "Blue Dog" Democrats that ended with the adoption of a compromise agreement by the Committee. Key provisions of that agreement include:

  • Negotiated Payment Rates. Authorizes the Secretary of the U.S. Department of Health and Human Services to negotiate payment rates for the public plan that are not lower than the Medicare rate nor higher, in the aggregate, than the average rates paid by private insurance plans participating in the Health Insurance Exchange.
  • Payment Innovation. Creates the Center for Medicare and Medicaid Payment Innovation within CMS for the purpose of testing various payment models and methodologies on a demonstration project basis. If the models being tested improve quality and do not increase spending, provides the Secretary of HHS with discretionary authority for expanding the duration and scope of the models, including implementation on a nationwide basis.
  • CO-OP Option. Establishes a Consumer Operated and Oriented Plan (CO-OP) program under which grants and loans will be provided for the establishment and initial operation of nonprofit, member-run CO-OP plans offered through the Health Insurance Exchange.
  • Medicaid. Reduces the federal share for Medicaid costs (FMAP payments) from 100 percent to 90 percent for required Medicaid expansions beginning in 2015; directs the U.S. Government Accountability Office to conduct separate studies on FMAP payments and Medicaid administrative costs by FY 2011.

A list of the amendments considered by the Committee during markup is available online. For a detailed overview of the House reform bill, please see the July 23, 2009, issue of the Health Law Update.

The reform bill passed by the Energy and Commerce Committee differs significantly from the versions passed by the House Ways and Means and Education and Labor Committees. The Tri-Committees and House leadership are expected to work through the August recess on combining the three versions of the bill into a single measure for a vote on the House floor in September. The House now stands adjourned until September 8, 2009.

The Chair of the Senate Finance Committee, Max Baucus (D-Mont.), has reset the deadline for his Committee to produce a bipartisan measure to September 15. It is anticipated that the six-member group spearheading the Committee's negotiations on the reform bill -- Chair Baucus, Kent Conrad (D-N.D.), Jeff Bingaman (D-N.M.), Ranking Member Chuck Grassley (R-Iowa), Olympia Snowe (R-Maine) and Mike Enzi (R-Wyo.) -- will continue deliberating through the month of August. On Friday, the Senate will adjourn until September.

The Health, Education, Labor and Pensions (HELP) Committee approved its version of the Affordable Health Choices Act on July 15, 2009. A section-by-section summary of the HELP Committee's bill that includes the adopted amendments is available online.

The versions produced by the Senate HELP and Finance Committees will have to be blended prior to a vote by the full Senate. In a recent statement to the press, Senator Baucus said the version being deliberated by the Committee's negotiating group is "80 percent identical" to the bill approved by the HELP Committee.