As a follow up to President Obama's address to a joint session of Congress last week, members on the Senate Finance Committee are poised to release details of their health care reform legislation. The group dubbed the "gang of six" are working on finding a comprise that may gain Republican support in the Senate. If the group fails, Democratic leaders may still attempt to pass reform legislation and have threatened to use procedural maneuvers to work around a filibuster.
The Finance Committee did release a draft framework for reform last week, which replaces a public option with CO-Ops; contains an individual mandate beginning in 2013; includes small business tax credits; and would create state-based health insurance exchanges. Specifically, the draft framework covers:
- Employer Responsibility - Employers would not be required to offer health insurance coverage. However, employers with more than 50 full-time employees (30 hours and above) that do not offer health coverage must pay a fee for each employee who receives the tax credit for health insurance through an exchange. The assessment is based on the amount of the tax credit received by the employee(s), but would be capped at an amount equal to $400 multiplied by the total number of employees at the firm (regardless of how many receive a credit in the exchange).
- Small Business Tax Credits - Similar to the House bill, credits are limited to firms with fewer than 25 employees and average wages below $40,000, and the maximum credit available would be 50%.
- Individual Responsibility - Beginning in 2013 all citizens would be required to purchase health insurance or receive coverage from an employer with the penalty for failing to obtain coverage being as high as $950 for individuals and a maximum penalty per family of $3,800.
- Revenue Provisions - Tax high cost plans with a 35% excise tax for plans above $8,000 per individual, $21,000 for family. Additional revenue provisions include taxes on the pharmaceutical manufacturing industry and health insurance industry.