Compromise in the House: Blue Dogs Weaken Health Care Rerform Bill

On July 31, 2009, after much negotiation with conservative Democrats, the House Energy and Commerce Committee passed a health care reform bill.

All of the Republicans on the committee opposed the bill--not surprising given the GOP seems to believe it can get back in power if it can thwart Obama’s health care reform plan. What demonstrates just how challenging passing comprehensive health care reform legislation will be, however, is that they were joined by five Democrats who, according to Congressional Quarterly, are mostly members of the Blue Dog Coalition:

“Four other Blue Dogs supported the measure, giving Democrats the margin they needed to advance it from the committee. But the Blue Dogs’ support came only after two weeks of negotiations with the committee’s chairman, Henry A. Waxman, D-Calif. Democrats on the committee did not strike a final deal until early Friday morning.

“The Democrats who opposed the measure were Rick Boucher of Virginia, Bart Stupak of Michigan, Jim Matheson of Utah, Charlie Melancon of Louisiana and John Barrow of Georgia. The latter three are Blue Dogs. Stupak opposes abortion and believes that the measure will lead to increased numbers of the procedure.

“Under the agreement, the Blue Dogs won an amendment that would require a government-run insurance plan the bill would create what Democrats call a “public option” to negotiate payment rates with health providers, rather than paying rates set at those of Medicare, plus 5 percent...

“The amendment also would cut the cost of the $1 trillion bill by trimming subsidies that would be provided to low-income people to help them buy insurance through a new, regulated marketplace called an ‘exchange.’”

Conservative Democrats also won the ability for states to get government loans to create co-ops and were able to raise the small business exemption (the businesses that would be excused from having to provide health care for their employees) up to those with $500,000 in annual payroll.

This fracture within the Democratic Party has weakened important components of President Obama’s health reform plan, including the public health insurance plan option, assistance for people with low incomes, and the push for shared responsibility. That is why progressives in Congress are not happy with the deal:

“Hours after Energy and Commerce Chairman Henry A. Waxman and four of his committee’s seven ‘Blue Dog’ Democrats broke a deadlock that had stalled a markup of the bill (HR 3200) for more than a week, liberals on the panel objected to that agreement.

“The discontent signaled another possible setback for Democratic leaders, who no longer hope to move health care legislation to the floor of either the House or the Senate before the August recess. They had pointed to the agreement with members of the fiscally conservative Blue Dog Coalition and a new scoring of legislation under discussion in the Senate Finance Committee as evidence that health care legislation was gaining momentum...

“Of principal worry is a compromise that would weaken the government-run ‘public plan, requiring that it negotiate rates with doctors, hospitals and other providers, rather than simply pay Medicare rates plus 5 percent.”

The Congressional Progressive Caucus sent a letter to the House leadership making the opposition of 57 of their members to those changes clear:

“We regard the agreement reached by Chairman Waxman and several Blue Dog members of the Committee as fundamentally unacceptable. This agreement is not a step forward toward a good health care bill, but a large step backwards. Any bill that does not provide, at a minimum, for a public option with reimbursement rates based on Medicare rates--not negotiated rates--is unacceptable. It would ensure higher costs for the public plan, and would do nothing to achieve the goal of ‘keeping insurance companies honest,’ and their rates down.

“To offset the increased costs incurred by adopting the provisions advocated by the Blue Dog members of the Committee, the agreement would reduce subsidies to low-and middle-income families, requiring them to pay a larger portion of their income for insurance premiums, and would impose an unfunded mandate on the states to pay for what were to have been Federal costs.

“In short, this agreement will result in the public, both as insurance purchasers and as taxpayers, paying ever higher rates to insurance companies.

“We simply cannot vote for such a proposal.”

Progressives and other supporters of comprehensive health care reform around the country need to actively oppose these changes to the House health care reform bill. Those who oppose reform and support the insurance industry agenda are making their voices heard and are swaying Congress.

The action over the August Congressional recess will not be in Washington, DC. It will be in your home state.

This month, make sure your representatives hear from you!

Views expressed on this page are those of the authors and not necessarily those of Campaign for America's Future or Institute for America's Future