Senate Approves Bankruptcy Reform Bill Minus Health Measures

The Senate, on an 83-15 vote, approved bankruptcy reform legislation on March 15, as Republicans "fought off" amendments favored by consumer groups and some Democrats, including a provision to ease the new restrictions for those with debts resulting from medical bills, the Washington Post reports. The bill (S 420) would "make it harder" for individuals to file for Chapter 7 bankruptcy, which allows individuals to "wipe out most of their debts," and force more to file for Chapter 13 bankruptcy, requiring them to repay a portion of their debts over five years (Day, Washington Post, 3/16). According to consumer groups, the legislation would buoy credit card companies "at the expense of vulnerable debtors," who may have to file bankruptcy due to medical bills, job loss or divorce (Shenon, New York Times, 3/16). In recent days, Senate Democrats have proposed a number of amendments to "tempe[r]" the bill but have been "rebuffed almost every time" (Gordon, AP/Washington Times, 3/16). Among amendments rejected by the Senate last week was one sponsored by Sen. Paul Wellstone (D-Minn.) that would have allowed those filing for bankruptcy due to "disastrous" medical bills to have "a better chance" of erasing their debts in court than those "filing for other reasons" (Kaiser Daily Health Policy Report, 3/8).

Abortion Language a Sticking Point?
The Senate vote comes two weeks after the House approved similar legislation (HR 333). According to the Post, the Senate vote "virtually ensures" that the bill, which President Bush has indicated he will sign, will become law this year, "possibly within weeks" (Washington Post, 3/16). However, the two houses must still work out some differences between their bills, such as whether to keep an amendment included in the Senate version that would prevent individuals convicted of violence against abortion clinics from avoiding legal damages by declaring bankruptcy (New York Times, 3/16). The House's version of the bill does not include the abortion-related language (Kaiser Daily Reproductive Health Report, 3/2). According to the Times, "Republicans [in conference committee] are expected to try to strip" the final legislation of the language (New York Times, 3/16).