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Gang of 6 Framework

The Finance Committee bipartisan group led by Max Baucus released their Framework today, which finally contains most of the provisions they have been considering in writing. Initial estimates put the cost at $880B over 10 years.

Major highlights:

-Individual mandate, with Medicaid expansion to ALL individuals up to 133% FPL and tax subsidies up to 300% FPL.

-NO employer mandate, instead containing a shared responsibility fee on employers that don’t offer insurance for those employees receiving insurance tax credits.

-Immediate 35% small business tax credits beginning in 2011, with expanded credits in 2013.

-Minimum benefits package with four benefit tiers, plus additional “young invincible” policy for young adults which would include catastrophic coverage plus preventive services.

-State insurance exchanges, effective 2010, with separate individual and small group exchanges.

-51 State-based Health Insurance CO-OPs will compete in the reformed non-group and small group insurance markets. Priority in awarding start-up grants will be given to statewide proposals, integrated care models, and applications with significant private support.

-Immediate 50% drug discount to reduce Medicare Part D doughnut hole.

-Allows interstate purchasing of insurance for individuals in 2015 through state-formed “health care choice compacts.”

Major revenue provisions:

-35% excise tax on high-cost insurance plans

-Annual fees on pharmaceutical companies, medical device manufacturers, health insurance providers, and clinical laboratories totaling $13 billion/yr.