Congress returns to controversy over COBRA, doctors' Medicare pay

Jun 7 2010

CongressDaily reports that when members of Congress return to Washington Monday "they face a raft of unfinished business on tax 'extender' legislation. … The Senate will look to take up a $114.5 billion package of unemployment benefits, tax breaks, physician payments and other provisions this week amid calls from the right to scale it back, from the left to expand it and from businesses to mitigate its tax increases. The House passed its version after divisive debate late last month, but Congress ended up leaving town without preventing Medicare physician payment cuts and extending eligibility for unemployment insurance. That makes prompt Senate passage the No. 1 priority for Majority Leader [Harry] Reid, although there remains no clear path in what is expected to be a truncated week." Senate votes could start Monday night but most of the action is expected on Wednesday. Senators are facing pressure from Democratic group and unions to restore the $31 billion in state Medicaid funding and COBRA health insurance subsidies that the House dropped over concerns about the growing deficit.

"Of paramount interest is Medicare physicians' payments, which underwent a 21 percent cut on June 1 after the extenders bill went untouched in the Senate. … The House-passed version of the extenders bill would increase physician payments under Medicare by 2.2 percent through the end of 2010 and 1 percent in 2011. The package is also drawing ire from states and union groups because the House stripped provisions to extend federal assistance for Medicaid and COBRA subsidies to garner enough Blue Dog votes to pass the legislation" (Cohn and McCarthy, 6/6)

MarketWatch: "Just a few months after passing comprehensive health reform, U.S. lawmakers appear willing to risk a short-term backslide in the push to reduce the number of uninsured Americans until the overhaul's major provisions take effect in 2014. Unless Congress passes an extension retroactively, people who lose their jobs on or after June 1 no longer will receive government financial help to cover 65% of their premium costs for Cobra health coverage, which lets them continue on their former employer's group health plan. … Cobra coverage requires former employees to pay full freight for their health insurance, meaning the entire cost of the premium plus an administrative fee of up to 2%." The article provides some advice for laid-off workers looking for insurance coverage (Gerencher, 6/6).

Modern Healthcare: "Millions of people could lose health coverage because key federal safety net assistance was not extended in the recent jobs bill, according to a report released by consumer advocacy group Families USA. … Newly laid off people and low-income people are especially vulnerable to these omissions in assistance, under the bill, the report stated. 'The elimination of COBRA subsidies means that people losing their jobs will also lose their healthcare coverage,' said Ron Pollack, Families USA's executive director, in a written statement. 'Such a loss of health coverage flies in the face of the recently enacted health reform legislation that is intended to expand health coverage to tens of millions of people.'" Also, the House cut out of the bill provisions that would extend an enhancement in federal funding of Medicaid programs. That could lead states to curtail services when the extra federal funds run out on Dec. 31, the report said (Lubell, 6/6).

The Detroit News reports on the Families USA study and finds that under the current provisions passed by the House Michigan residents losing their jobs after June 1 "face average monthly COBRA health care premiums of $1,019, which would gobble up more than three-quarters of their jobless benefits. … The average laid-off Michiganian able to tap into the subsidy is paying $357 monthly for health care, a savings of $662 a month, Families USA calculates." In addition, the report notes, that without the Medicaid enhancement, Michigan will lose $668 million in federal funding. "Families USA and similar left-leaning groups are pushing the Senate to restore both provisions. But budget analyst Brian Riedl of the conservative Heritage Foundation, a Washington, D.C.-based think tank, opposes restoring the items, pointing out that the federal debt totals $13 trillion. … The proposed 6 months of extra Medicaid help for states would cost $24 billion over 10 years. Allowing workers laid off through the end of the year to tap into the federal COBRA subsidy would cost $7.8 billion over 10 years" (Price, 6/6).

CNN Money: "Dozens of people currently benefiting from the subsidy wrote to CNNMoney.com in recent days to say how crucial it is. Without the extra help, they said they could not afford to pay for their coverage and their treatments for diabetes, cancer, high blood pressure and other ailments. 'I'm unemployed. I don't have money to pay for medical bills,' said Stephanie Kohnke, a St. Paul, Minn. resident who lost her job in May and is waiting to be approved for the subsidy. 'This is the worst time to lose that safety net.'
House Speaker Nancy Pelosi, D-Calif., said Tuesday that she plans to revisit the COBRA subsidy. However, she noted, it is a controversial provision that could be difficult to pass. … Just how many people are filing for the subsidy isn't known. But a recent Treasury Department survey found that between 25% and 33% of eligible jobless New Jersey residents were participating and most of them were middle class" (Luhby, 6/6).

The Miami Herald: "When Congress returns Monday from a 10-day break, it will struggle to try to meet an impatient public's demands for it to fund, among other things, an extension of unemployment benefits that have expired, summer jobs for at-risk youth and fair fees for doctors who treat Medicare patients. … The key reason: Five months before congressional elections, moderate lawmakers -- especially Democrats -- are having trouble processing the mixed message they're getting from their constituents: Take care of pressing business, but do it responsibly" (Lightman, 6/6).

The Hill: "Senators returning from the Memorial Day recess can expect to be under intense pressure from their elderly constituents worried about losing access to their doctor. A steep cut in Medicare payments to physicians will go into effect shortly unless the Senate acts to prevent what physicians' groups are warning could be the unraveling of the nation's healthcare program for the elderly." The American Medical Association "is pressing seniors to call their senators and urge them to approve legislation preventing a 21.3 percent cut to Medicare payments. AMA on Thursday launched a multi-million dollar TV, radio and print ad campaign on the issue" (Pecquet, 6/5).