January 12th, 2010
05:33 PM ET
11 years ago

Democrats, unions struggle to reach health care consensus

Washington (CNN) - House Democrats anxious about health care negotiations prepared to meet Tuesday night as Speaker Nancy Pelosi and the White House conferred with labor leaders unhappy with a tax being considered for the final bill.

Pelosi huddled with several key union leaders in her office earlier Tuesday. President Barack Obama met with a dozen labor heads Monday night, and is scheduled to meet with the entire House Democratic caucus on Capitol Hill Thursday.

At issue for many House liberals and union heads is growing concern that Obama and the congressional leadership will place an excise tax on high-end insurance plans to help pay for the sweeping legislation.

AFL-CIO President Richard Trumka warned Monday that Democrats risk losing critical union support in the upcoming midterm elections if they don't drop the tax.

Proponents of the tax argue it's one of the most effective ways to curb medical inflation. Many Democrats, however, oppose taxing expensive policies because it would hurt union members who traded higher salaries for more generous health benefits.

Obama told National Public Radio in an interview in December that so-called "Cadillac plans ... don't make people healthier, but just take more money out of their pockets."

The House of Representatives did not include a tax on the high-end plans when it passed its reform plan in November. The Senate bill passed in December, however, would impose a 40 percent tax on insurance companies that provide plans valued at more than $8,500 for individuals and $23,000 for families.

Labor leaders have urged Congress and the White House to instead adopt the House health care financing plan, which includes a 5.4 percent income tax surcharge on individuals earning over $500,000 and families earning more than $1 million.

Looming over health care negotiations between the House and Senate is a widely held belief that the more liberal House will ultimately be forced to go along with key aspects of the more conservative Senate bill. The traditionally fractious 60-member Senate Democratic caucus struggled to unify behind a single measure, and needs to remain united to overcome solid Republican opposition.

Senate Minority Leader Mitch McConnell, R-Kentucky, told reporters Tuesday that Republicans will continue to strongly oppose the current Democratic health care reform plans.

One possible compromise idea among Democrats trying to bridge the divide between the House and the Senate is to raise the income threshold for the excise tax in an attempt to hit fewer workers, several Democratic leadership sources told CNN.

But some progressives have indicated strong opposition to the idea. New York Rep. Charlie Rangel, the liberal chairman of the House Ways and Means Committee, warned CNN Tuesday that raising the threshold in order to make the tax more politically palatable is "going to be a problem."

The sources said Democratic leaders are considering a range of thresholds as high as $28,000. In order to make up for the difference in lost revenue, an additional boost in Medicare taxes for wealthy Americans is being considered, according to multiple Democratic congressional sources.

The expanded Medicare tax, the sources add, would be designed to cover earnings on investments.

The Senate bill already passed in November would hike Medicare payroll taxes on families making over $250,000; the House bill does not.

Even if House and Senate Democrats reach a compromise on funding, they will still have to tackle a range of other controversial issues. Among other things, Democrats have to reach a final decision on whether to include a government-run public insurance option, as well as language relating to abortion coverage and illegal immigration.

House Democrats are also urging the Senate and the White House to agree to set up a national insurance exchange in the final bill, instead of the state-based exchanges in the Senate bill.

The exchanges are designed to make it easier for small businesses, the self-employed and the unemployed to pool resources and purchase less expensive coverage.

–CNN's Ted Barrett, Dana Bash, Alan Silverleib, and Deirdre Walsh contributed to this report.

Filed under: Democrats • Health care • House
soundoff (31 Responses)
  1. Jay T.

    Pelosi has been stand-up throughout this debate when it comes to looking out for middle-class interests. Obama? Not so much.

    January 12, 2010 05:41 pm at 5:41 pm |
  2. Cliff

    Sort of funny the hand they fed during the election is now sticking his hand in the pocket of the unions and unionites.
    How do you like your change?
    Guess "you losers" stick together...regardless! That's sad!

    January 12, 2010 05:42 pm at 5:42 pm |
  3. Mike

    Why don't our friends in Congress ask small business owners how we can come to a 'consensus' on health care?

    January 12, 2010 05:48 pm at 5:48 pm |
  4. ran

    Most if not all of the high end policies are paid by county/state/federal tax $. because most of them go to fire/police. Theses are the same groups who go after our property tax for their increase in salaries/benefits.

    I can do with less police and as far as I am concerned we can go back to an all volunteer fire department.

    If unions do not want a tax then get rid of the plans because with plans like those out there it makes it harder for the rest of us to get affordable health care or services because the providers like doctors and hospitals will accept the high end policies before the rest of us.

    January 12, 2010 05:52 pm at 5:52 pm |
  5. Centrist

    The health-care funding should be a combined balance of the House and Senate proposals.

    Raise the income levels in the House version above $500K to further assist small businesses.

    Raise the "Cadillac" level on the Senate plan to avoid affecting blue collar Americans.

    A win-win compromise towards health-care solutions for the American people.

    January 12, 2010 05:57 pm at 5:57 pm |
  6. Ren from Baltimore

    The Republicans may well have stretched this out to the point of breaking. Bunch of knuckle-headed, uninformed electorate AND greedy, small-minded politicians are to blame here.

    January 12, 2010 06:01 pm at 6:01 pm |
  7. Orange Curtain, CA

    Abortion IS legal and immigrants that are NOT get no coverage. Now can we have the public option finally?

    January 12, 2010 06:03 pm at 6:03 pm |
  8. Larry S

    Amazing . . . and just a few days back, oBLAHma was saying the health bill would reduce the deficit . . . again, he is telling lies. He will never be a leader and only a campaigner. He gives promises without truthfulness.

    January 12, 2010 06:05 pm at 6:05 pm |
  9. Mark, We Hardly Knew Ya

    Regarding Mark McGuire. I don't think he should be punished. I think keeping him out of the Hall of Fame is going to drive him crazy. Let him talk about how good he would have been without the steroids for the rest of his life. That's punishment enough.

    January 12, 2010 06:06 pm at 6:06 pm |
  10. Run while there is still time

    Labor Unions need to run away from this adminstration while they still have private sector jobs.

    January 12, 2010 06:12 pm at 6:12 pm |
  11. wlou437

    Will the tax on "Cadillac" plans include the federal goverment place for congress?
    What part of the plan will motivate more doctors to accept Medicare patients?
    No matter what is decided about illegal immigrants, they will continue to go to emergency rooms and the taxpayer will pay the bill.
    Has anyone figured out what a "reasonable" amount for health insurance is for a family of 4 to pay?

    January 12, 2010 06:19 pm at 6:19 pm |
  12. Censoring again? Callahan

    If you read this correctly...you wonder if the object is to tax the rich (or those holdly more money) out of their livelihood....making all subservent to the governement rule....now that is scary. If you tax the middle class for the cadillac plan ..it's inevitable they will forfiet their plan for a 'governement plan' disguised under the Health Care plan.......this whole thing is just so messed up.....wipe if off and start again........

    Also, there is a question of why the rush now..perhaps it has something to do with the recent polls for the replacement of Ted Kennedy......a Republican winning...one that could 'stall' this process.

    Just sayin'

    January 12, 2010 06:29 pm at 6:29 pm |
  13. Mike in MN

    The end result of this Democrat circus is that Democrats will eventually pass a monster of a mess of a bill almost know one likes and then make total fools of themselves in the 2010 elections bragging about it. Republicans will dominate in 2010 and in 2012.

    January 12, 2010 06:29 pm at 6:29 pm |
  14. Don H

    Yes, thats it. Cut special deals with union cronies so that the rest of us have to pay more for this monstrosity/farce of a bill. The way this thing is playing out, all democrat campaign supporters will get off without paying any additional costs while the rest of us get shafted.

    This idea of taxing high-value health plans was supposedly one of the keys to lowering overall healthcare costs, since people who have these plans have little or no incentive to curtail the amount of healthcare they consume. So much for personal responsibility...

    January 12, 2010 06:30 pm at 6:30 pm |
  15. obama the liar

    now we will see who controls whom.....the community organizer or the union goons.

    January 12, 2010 06:35 pm at 6:35 pm |
  16. They call me "tater salad"

    Well, the money has to come from somewhere!..............Thats the problem with the sheeple in this country.........We want it all.........We want it now...............But, we don't want to PAY FOR IT........GET REAL.....Nothing is for free and the sooner people realize that, the sooner they can catch up with the rest of us over here in the real world!

    January 12, 2010 06:36 pm at 6:36 pm |
  17. tess

    OBAMA has lied and lied over and over again to us. CNN can see it
    and they never '...call OBAMA on it...'! Is CNN against the people of
    these United States?

    CNN please tell us where the '....TRANSPARENCY...." that OBAMA spoke of so clearly is now? He has even lied about the number of
    people who are without a job in the last overview... We want a truthful government.

    January 12, 2010 06:46 pm at 6:46 pm |
  18. Four and The Door

    Take a step back and see what a farce this Health Care Reform has become:

    1. It is supposed to reduce the defecit but it will cost the government $1 trillion and the Democrats haven't figured out who to tax yet.
    2. It is supposed to reform health care but it raises the cost faster than they would go up if nothing was done.
    3. Unemployment is at 10% and the economy continues to tank, but this is the largest spending program being considered and it is getting most of the attention of all of the Democrats in Washington, but it doesn't create jobs or help the economy.

    I guess these politicians have their own interpretation of "Public Service".

    January 12, 2010 07:01 pm at 7:01 pm |
  19. Henry Miller, Libertarian

    Oh, they'll find a consensus, the same one they always find: soak "the rich." Unfortunately, for most Americans, their common consensus of what constitutes "rich" will be "having a greater-than-zero income and not being a member of a union."

    January 12, 2010 07:06 pm at 7:06 pm |
  20. Stevo

    Unions take hundreds out of your paycheck in dues, lobby states to pay cashiers $20/hr, give members cadillac insurance plans and run the auto-industry into the ground with demands for higher pay and benefits.

    Granted everyone deserves high pay and benefits and without unions many wouldn't have any, BUT – they are being a bit too self serving. Everyone deserves a piece of the pie, but unions tend to want to control the cook, the ingredients and the portions.

    Make me long for the 50's – when unions were actually needed.

    January 12, 2010 07:08 pm at 7:08 pm |
  21. ib

    This bill should not be passed; it will lead to healthcare rationing for senior citizens and higher costs for everyone. Why can't people open their eyes and see what it will really do??? Please people open your eyes past being a liberal or conservative and see what is really going on with this bill.

    January 12, 2010 07:11 pm at 7:11 pm |
  22. annie against biased news

    This has been very interesting according to obama, dirty harry, the black caucus, naacp, donna brazilenut and various others the only GOOD black person is a light skinned black person with excellent pronunciation of the English language. According to their standards the rest of the black population (our country or around the world) is just low life scum. So the true racist show their ugly faces – they are judging each other by the tone of the skin and vocal sounds not by the quality of the person. Shame on this whole sorry bunch, they have put down the majority of the African/Americans with the most ridiculous hate speech I have ever heard.

    January 12, 2010 07:13 pm at 7:13 pm |
  23. Tom in Illinois

    Evidently the unions don't like the change they supported and voted for. Too bad.

    January 12, 2010 07:17 pm at 7:17 pm |
  24. Catty

    Sounds like more backroom deals coming from our democratic congress. Shameful.

    January 12, 2010 07:18 pm at 7:18 pm |
  25. Gerry NH

    No body wants this plan it stinks. Congress does not want it for them or their employe4es. The unions don't want it fir union employees. The representative for NH said in a e-mail to me (Porter) that she was happy with her current plan but if it was not available she woould be happy to take this plan. That statement sealed a no vote to her in the next election. Never tells the truth.

    January 12, 2010 07:18 pm at 7:18 pm |
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