Healthcare Reform Update

July 30, 2009
July 30, 2009Greetings!

As Congress continues to develop a healthcare reform bill, I want togive you an update on the status of legislation in the House ofRepresentatives and make you aware of some key issues.

As I continue to work with my colleagues on the House bill,the Senate is working to craft their own legislation. While neitherbody has passed a final bill, I anticipate these votes will occur inSeptember, with the differences in the two bills being worked out inConference before being sent to the President in the fall.

The House legislation as written today will ensure that 97% of allAmericans will have coverage under a healthcare plan that is affordableand offers quality, standard benefits. It protects choice, it rewritesthe rules of the insurance industry, it encourages competition with apublic option, and it assists small businesses who are struggling tocover employees with an affordable plan.

Listed below are some of the bill's significant benefits for our Congressional District:

  • Help for small businesses Under the legislation, smallbusinesses with 25 employees or less and average wages of less than$40,000 would qualify for tax credits of up to 50% of the cost ofproviding health insurance. There are up to 15,000 small businesses inour District that would qualify for these credits.

  • Help for seniors with drug costs in the Part D 'donut hole'Each year, 2,700 seniors in our District hit the Medicare 'donut hole'and are forced to pay the full amount of their drug costs, despitehaving Part D drug coverage. The legislation would provide them withimmediate relief, cutting brand name drug costs in the donut hole by50% and ultimately eliminating it.

  • Relieving the burden of uncompensated care for hospitals and healthcare providersIn 2008, healthcare providers in our District provided $46 millionworth of uncompensated care. This is care that was provided toindividuals who lacked insurance coverage and were unable to pay theirbills. Under the legislation, these costs of uncompensated care wouldbe virtually eliminated.

  • Coverage of the uninsured There are 49,000 (8%) uninsuredindividuals in our Congressional District. The Congressional BudgetOffice (CBO) estimates that nationwide, 97% of all Americans will haveinsurance coverage when the bill takes effect. If this benchmark isreached in our District, 29,000 people who currently do not have healthinsurance, will receive coverage.

  • No deficit spending Under the legislation, the cost ofhealthcare reform is fully paid for. Half is paid for by making theMedicare and Medicaid programs more efficient, and half through asurtax on the income of the wealthiest households ($350,000 or more.)93% of taxpayers in our District would not be affected.

  • Insurance Reforms The legislation bans insurancecompanies from discriminating against those with pre-existingconditions, and from dropping those who become ill.

The bill also contains an important provision for our District,especially Santa Cruz County where physicians who treat Medicarepatients are severely underpaid. Due to outdated maps that classifySanta Cruz County as "rural", doctors are reimbursed at a lower ratefor performing the same services as their San Mateo and Santa Claracounterparts. The provision, known as the Geographical Price Cost Indexor GPCI, remedies this error and will allow Santa Cruz physicians toreceive proper reimbursement and once again accept Medicare patients.

I plan to offer an amendment to create a pathway forbiosimilar drugs. Biosimilars are generic versions of biologic drugs,some of the most complicated, innovative, and life-saving drugsavailable. While these drugs have tremendous curative results, they arealso very expensive. This provision will allow new generic versions totreat and save individuals, as well as saving the government billionsof dollars and allowing innovation to flourish.

Click here to see the most common questions about healthcare reform legislation I've received from my constituents and answers to them.

If you have any thoughts or comments, please transmit them to me by email if possible. This will save time and your taxpayer dollars!

All my best,

Anna G. Eshoo
Member of Congress