Negotiations on Economic Stimulus Bill Stall; Health Insurance for Unemployed Workers Still ‘Main Obstacle’

Negotiations among House and Senate lawmakers on Dec. 17 to reach an agreement on an economic stimulus bill stalled again over provisions to help unemployed workers purchase health insurance, the Wall Street Journal reports (McKinnon/Murray, Wall Street Journal, 12/18). Rep. Bill Thomas (R-Calif.) said that the issue represents the "main obstacle" to reaching an agreement (Anderson, AP/Philadelphia Inquirer, 12/18). Thomas on Dec. 17 "declared dead" negotiations with Sen. Max Baucus (D-Mont.), the "principle negotiator" for Senate Democrats, and met with Sen. John Breaux (D-La.) to discuss a compromise bill that "might be acceptable" to moderates in the Senate (Boyer/Sammon, Washington Times, 12/18). Thomas plans to draft legislation, which would include provisions to help unemployed workers purchase health insurance, that may "draw enough backing" from Senate moderates to "pressure" Senate Majority Leader Tom Daschle (D-S.D.) to schedule a vote (AP/Philadelphia Inquirer, 12/18). Breaux said that he hoped the compromise bill would include a provision that would cover 60% to 65% of the cost of health insurance for unemployed workers. "If we could get a premise ... that the federal government is willing for the first time in history to pay a large percentage of an unemployed person's health insurance, that is a huge step," Breaux said (Washington Times, 12/18). The compromise legislation could reach the House floor by midweek (AP/Philadelphia Inquirer, 12/18). In October, the House passed a GOP-sponsored bill that would increase by $3 billion funding for the Social Services Block Grant program to allow states to provide health insurance to unemployed workers (Kaiser Daily Health Policy Report, 10/29).

White House Meeting
Meanwhile, President Bush will meet with congressional leaders this morning at the White House to discuss economic stimulus legislation (Wall Street Journal, 12/18). Daschle, Senate Minority Leader Trent Lott (R-Miss.), House Speaker Dennis Hastert (R-Ill.) and House Minority Leader Dick Gephardt (D-Mo.) plan to attend the meeting (Stevenson, New York Times, 12/18). In the past few days, Bush has "talked extensively" with lawmakers "in hopes of patching together sufficient support" for a compromise that he proposed last week (AP/Philadelphia Inquirer, 12/18). Bush's proposal includes a $30 billion provision to extend unemployment benefits by 13 weeks and provide an "advanceable" 50% tax credit -- up to $294 a month for families -- to help unemployed workers purchase health insurance (Kaiser Daily Health Policy Report, 12/13). Daschle has proposed a 75% subsidy to help unemployed workers purchase health coverage through COBRA and additional funds to allow states to extend Medicaid coverage to unemployed workers who do not qualify for the program. COBRA, the 1986 Consolidated Omnibus Budget Reconciliation Act, allows unemployed workers to retain health coverage under their former employers' insurance plans by paying 102% of the premiums (Kaiser Daily Health Policy Report, 12/14).

Deal 'All But Impossible'?
As negotiations on an economic stimulus bill "teeter on the edge of failure," an agreement "appears all but impossible," and provisions to help unemployed workers purchase health insurance are "a key roadblock to the deal," the Washington Post reports (Kessler, Washington Post, 12/18). Democrats have "said repeatedly" that an economic stimulus bill must "focus primarily" on extending unemployment benefits and paying health insurance for the unemployed (Washington Times, 12/18). However, Republicans consider such provisions "permanent expansions of government spending programs," which they oppose (Washington Post, 12/18).

Washington Post Editorial
A Dec. 18 Washington Post editorial states that the aim of the health insurance tax credits included in the economic stimulus plan by Republicans is to "bump the entire health care system in the direction of such credits." The editorial warns, "That's a huge change about which serious questions have been raised, including its likely deleterious effect on the current system of employer-paid coverage." The editorial adds that economic stimulus legislation "ought not be an instrument of, nor hostage to, such experimentation" and concludes that Republicans "have tried to use this bill for extraneous purposes, and ought to be called on it" (Washington Post, 12/18).