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Health care industry

Senate's Health Care Plan Aims to Expand Coverage to 34 Million Americans

Strategic Insights

— 2 min read

The Senate's plan to expand health coverage to 34 million more Americans would raise costs slightly, but cost-cutting measures could reduce annual health care spending increases, offering substantial savings in the long run. However, some of the Medicare savings proposed may be unrealistic, and lawmakers might roll them back. The plan would increase health spending by less than 1 percent over the coming decade, even with additional coverage.

Key Takeaways:

  • The Senate plan would expand health coverage to 34 million more Americans, but would raise costs slightly in the short term.
  • Cost-cutting measures, such as the tax on "Cadillac" health plans, could reduce annual health care spending increases and offer substantial savings in the long run.
  • However, some of the Medicare savings proposed may be unrealistic, and lawmakers might roll them back, according to Medicare's top number crunchers.
  • The plan aims to reduce the annual increases in health care spending, which accounts for about one-sixth of the economy.
  • The House and Senate versions of the overhaul differ on details, such as whom to tax, how many people to cover, and whether illegal immigrants should be allowed to use their own money to buy coverage in new insurance markets.
  • President Barack Obama met with Democratic lawmakers at the White House to help resolve the remaining sticking points.
  • The proposed 40 percent excise tax on high-cost health plans would hit more and more people over time, virtually guaranteeing lawmakers would feel pressure to ease the tax.
  • Republican lawmakers oppose the legislation, citing its cost and government control.
  • The plan would ban "the worst practices of the insurance industry" and provide dozens of protections and benefits, including allowing people with illnesses or medical conditions to buy affordable health insurance.

Statistics:

  • Health spending, which accounts for about one-sixth of the economy, would increase by less than 1 percent over the coming decade.
  • 34 million more Americans would gain health coverage under the Senate plan.
  • The tax on "Cadillac" health plans would help reduce annual health care spending increases and offer substantial savings in the long run.
  • The 40 percent excise tax on high-cost health plans would hit more and more people over time.
  • The plan would take several years to fully implement, with some changes not taking effect until 2014.
  • Dozens of protections and benefits would take effect this year, including allowing people with illnesses or medical conditions to buy affordable health insurance.

Sources:

  • Superville, DARLENE. "Senate Health Care Plan Would Expand Coverage to 34 Million". AP. http://www.ap.org/
  • Obama, Barack. "Weekly Address: 'Health Insurance Reform'". BarackObama.com. http://www.barackobama.com/weekly-address/

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