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FACTBOX-Proposed changes to U.S. Senate healthcare bill

WASHINGTON, Dec 19 (Reuters) - Senate Democratic leader Harry Reid has proposed several changes to sweeping U.S. healthcare reform legislation being debated in the Senate. The proposed amendment has to be approved by the Senate.

Here is a summary of those proposed changes and revised cost estimates made public by the Congressional Budget Office on Saturday.


* The Congressional Budget Office said the legislation, with the proposed changes that are being offered as an amendment to the bill, would cost about $871 billion over the first 10 years. Those costs would be more than offset by $483 billion in spending savings and $498 billion in revenues over the period. CBO said the bill would reduce the deficit by about $132 billion between 2010 and 2019.


* The proposed government-run insurance option would be dropped from the bill. Instead, the federal government would contract with insurers for two national or multi-state health insurance plans that would be offered through the new insurance exchanges. The U.S. Office of Personnel Management, which oversees health policies for 8 million federal workers and their families, would manage the public plans.

One of the plans is to be non-profit. The CBO said it was unclear whether insurers would be interested in contracting with OPM to offer these plans and said the proposal would have little impact on federal costs or enrollment on the exchanges.


* The abortion provision that aimed to ensure public money would not be used to pay for elective abortion services would be changed with more restrictive language that strengthens the firewall against the use of public money for abortion services.


* The small business tax credit for healthcare coverage would be sweetened so that more firms would qualify. The tax credits would be available in 2010, a year earlier than originally proposed. The income threshold would be increased so that they will be available on a sliding scale to firms with fewer than 25 workers and an average wages of less than $50,000. Employers with 10 or fewer workers and average wages of less than $25,000 can get the full credit.


* Insurers’ profits and administrative expenses would be capped by a requirement that they pay a minimum amount of annual premium income on medical benefits. Insurance plans for large groups would have to spend at least 85 cents out of every dollar on medical costs. Small group and individual plans would have to spend at least 80 cents on the dollar for care.

* Insurers would immediately be prohibited from excluding health coverage for children due to pre-existing conditions.


* The amendment calls for a slightly higher Medicare payroll tax for high-income people than the underlying bill. Instead of a 0.5 percent increase in the tax for individuals earning $200,000 and couples earning $250,000 or more, the amendment calls for a 0.9 percent increase in the tax.

* A proposed tax on elective cosmetic surgery and treatments would be dropped. Instead a 10 percent tax would be imposed on indoor tanning beds, which health experts say can cause cancer.

* Proposed new taxes on insurers and medical device makers would be delayed by one year under the amendment. But they would be ramped up over time. The bill originally proposed a $6.7 billion a year tax on the health insurance industry. Now the new tax would start in 2011 and gradually increase to $10 billion in 2017. Medical device industry will pay $2 billion a year starting in 2011 and $3 billion after 2017. (Reporting by Donna Smith; Editing by Eric Beech)