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Checking In With…Charles Grassley, R-Iowa

Sen. Charles Grassley, the ranking member of the Finance Committee, is used to working on bipartisan deals with longtime political ally Max Baucus, D-Mont., chairman of the panel. But he acknowledged, in an interview with Senior KFF Health News Correspondent Mary Agnes Carey, that such past negotiations seem “minor league” compared to their current challenge: trying to put together a bipartisan bill to overhaul the health care system. “When you restructure 16 percent of the gross national product,” he says, “there are few people you aren’t going to irritate.”

The Iowa Republican talked about the pressure on both him and Baucus from members of their own parties, and about his staunch opposition to three ideas backed by many Democrats: the creation of a public plan to compete with private insurers; a federal health board that would oversee the nation’s health system, and a requirement that employers “play or pay”-either cover their employees or pay into a fund to help pay for the uninsured. Here are edited excerpts:

Q: Sen. Baucus has said that you are facing “a lot of pressure from different folks” as you work with him on health care legislation. Are you feeling pressure from your fellow Republicans?

A: I believe that it comes from what we Republicans believe on a couple of issues versus what Democrats believe. Those issues include the public option, a health board plus the concept of “play or pay,” the employer mandate. When he says I’m under pressure it would be from this standpoint: that he and I generally don’t have any problems getting to an agreement, but because of my belief in not having a health board and my belief in not having a public option and play or pay, that makes it difficult. So I think the pressure comes in just my feeling about representing my point of view, as well as my party’s point of view, on things that are so opposite to what Sen. Baucus is under pressure to negotiate for

Q: So you’re not getting pressure from your party leaders to avoid working with Sen. Baucus on a bill?

A: Just the opposite. They know that you can’t say you aren’t going to have a bipartisan agreement until you work to a point where you either do or you don’t. And so what are the Republicans willing to give on and what are Democrats willing to give on? You’ve got to see some sort of a negotiated product before you can come away with it, until you say that there’s nothing.

It’s just a case of a difference in the two parties’ philosophies. I’m not sure where Sen. Baucus stands on all those things but I know that a vast majority of his party would go way beyond a health board and way beyond a public option. A lot of his people in his caucus think he’s crazy for not negotiating single payer. On second thought, I’d say the pressure’s kinda mutual. He’s got pressure from his party, I’ve got pressure from my party, but it’s based upon real, deep-seated convictions of each political party.

Q: Sen. Baucus has said there’s a 75 to 80 percent chance that a Senate health care overhaul package will pass on a bipartisan basis. Do you agree?

A: I think it’s an absolute necessity, not just because of the issue of health care reform but because we’re restructuring 16 percent of the gross national product and when you’re doing that you ought to have a big consensus for what you’re doing or it shouldn’t be done.

If we would cap the exclusion (which allows workers to not pay taxes on employer-provided health benefits) a certain number of people will pay some tax on additional health benefits that they wouldn’t otherwise pay. Or if we start finding ways to save money in health care delivery, doctors, hospitals, home health people, name everybody who gets something out of the Medicare pot. When you have some sort of modified community rating (which allows rates for insurance to vary by such factors as age and gender but within limits) a lot of people that are healthy, like 20 year olds, might pay a little bit more and a lot of sick people who are sick now and paying too much, which is one of our goals, they’re paying less, they might be happy.

When you restructure 16 percent of the gross national product, there are few people you aren’t going to irritate. Getting back to 70 or 80 votes, all the more reason we need that sort of a consensus.

Q: Let’s talk about the tax exclusion for health benefits. What’s the likelihood that it will be tapped as a source of funding for health care reform?

A: It’s just as difficult for Baucus as it is for me. He had some people on his side of the aisle and I won’t name them, telling him how difficult it was for them to vote to cap the exclusion and I’ve got people on my side who feel the same way. But I think that’s not the most difficult issue we have to face. The other three (public plan, the health board and the employer mandate) are more difficult.

I think the extent to which we get that (a cap on the tax exclusion) done is the extent to which the president comes out strongly in favor of some version of it. And the reason why I think that’s important is that the exclusion was a big part of the McCain health agenda and he ridiculed that in the debates. For Republicans to go along with it, it’s going to take presidential leadership.

Q: How has President Obama conducted himself so far on health care reform? Has he done too much? Too little?

A: I would say about right. When I say about right I ought to say it a little stronger in regard to one aspect in how he handled himself. He didn’t write a bill. He learned from the Clinton era. He does stand ready to help. When Baucus and I had lunch with him and Biden, he said he was going to engage and I even asked him to engage. That was if there was going to be a bipartisan agreement. Because that would take as much engagement with his party as it would for him to condemn Republicans for not doing enough. I think engagement comes down the road, probably the most important engagement will be the vast differences between the House partisan proposal and the bipartisan proposal in the Senate. He personally will be engaged more as time goes on.

Q: You were a critical player during the 2003 negotiations over the Medicare prescription drug bill. What lessons did you learn from that experience?

A: That was probably the toughest thing we’ve done until now but that’s minor league compared to what we’re doing nowYou’ve got to understand that 86 percent of the people have health insurance and most of them are satisfied with it and we are going to change some of that. About the only thing that might not be changed is the extent to which Republicans agree with the president if you like your health insurance you ought to be able to keep it. Outside of that there’s going to be some changes.This is not going to be an easy proposition.

The lesson learned (from the drug bill) was we would have never gotten that done if it hadn’t been bipartisan in the Senate and I don’t think this is going to get done if this is not bipartisan.