The Baucus Plan

What is Max Baucus proposing in his inital health reform bill?  Most of the principles are based on the Senate Finance Committee 2009 white paper.  Below 

• Creation of a Health Insurance Exchange. Insurers participating in the exchange could would be precluded from discriminating based on pre-existing conditions.
• Expand Medicaid to all individuals below 133% of the federal poverty line.
• Expand SCHIP to cover all children in household below 250% of the federal poverty line in 2013.
• Reduce Medicare Part D ‘donut hole’ so that enrollees in the donut hole range only pay 50% of drug costs rather than 100%.
• Standardize benefits into 4 categories: bronze, silver, gold and platinum.  
• Excise Tax: Levy a non‐deductible excise tax of 35% on insurance companies and plan administrators for any health insurance plan that is above the threshold of $8,000 for singles and $21,000 for family plans.  
• Individual Mandate with tax subsidies.  Those with incomes between 133% and 300% of the FPL would be eligible for these subsidies.  Those who don’t get health insurance will be subject to a fine.
• Employers who don’t provide health insurance must contribute to a fund to cover government insurance/subsidies for these individuals. Small employers with less than 50 employees are exempted from this requirement.
• Small business subsidy.  Businesses with the fewest workers and the lowest wages would be offered a new tax credit to purchase health insurance for their employees.  The subsidy is up to 35% of the business’s contribution.  
• $6 billion for co-ops.  This money would be used to fund the start-up costs and capital requirements for these co-ops.
• Preventive Services: Eliminate Medicare copayment for preventive care.  Provide financial incentives to encourage Medicaid to cover preventive care services without copayments.
• Do not cut Medicare physician payment according to the SGR.  Instead, increase Medicare physician compensation.
• Malpractice reform. Allow states to develop alternatives to the current tort litigation system.

Ezra Klein also has a nice review of parts of the Baucus bill: Exchanges, Insurance Regulation, Affordability, Individual Mandate, Co-ops, Taxing Insurers.  Time magazine also has a FAQ on the Baucus bill.

Also see  the CBO and CBPP analysis of the plan.