Biz Gives House Health Bill Thumbs Down

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The $1 trillion House health reform bill that passed over the weekend is being roundly booed by business groups that say it won't lower medical costs and creates an unneeded new government insurance program.

The government plan (a.k.a. the public option) continues to be one of the most contentious issues in the reform debate. The proposal wasn't included in a Senate Finance Committee plan that passed last month and some business groups are hoping it won't be in a final bill. (One compromise discussed in the Senate creates a public option that lets states opt out.) The public option is aimed at insuring people who can't get coverage through employers.

But the public option is just one sore spot. An employer insurance mandate and a tax on the wealthy are others. Trade groups representing small business, CEOs, the insurance industry, and even President Obama's buddies the drugmakers blasted the House bill.

“The current House legislation fails to bend the health care cost curve and breaks the promise that those who like their current coverage can keep it," Karen Ignagni, CEO of America’s Health Insurance Plans, says in a statement. "A new government-run plan will cause millions to lose their existing coverage."

The Business Roundtable, an association of company CEOs, criticizes the measure for not reducing costs.

"The bill fails to meet the bipartisan goal of controlling costs," the group says in a statement. "The government-run plan would just shift costs to employers: first, by shrinking and unbalancing the pool of individuals covered by private insurance and, second, by reimbursing providers at a sub-market rate. This won’t just hurt businesses, it will hurt the millions of workers who have coverage through their employers."

The nation's largest association of small businesses says the public option won't provide the competition or reform the insurance market. And requiring small employers to provide insurance isn't solving the issue of skyrocketing premiums.

"An employer mandate does not address the No. 1 issue facing small businesses: unsustainable costs," Susan Eckerly, senior vice president of the National Federation of Independent Business, said in a letter written to House members before Saturday's vote.

Pharmaceutical companies have been reform cheerleaders for President Obama's reform after striking a deal with the president to accept $80 billion less in government payments over the next 10 years. But the House bill expects drug companies to give up far more (as much as $150 billion). The pharmaceutical companies say losing so much revenue will cost the industry jobs.

One industry executive says he hopes a final bill will be kinder to drug companies.

"This is a three-act play, and a good critic doesn’t write a review after the opening scenes," Ken Johnson, senior vice president for Pharmaceutical Research and Manufacturers of America, says in a statement. "We are still hopeful that before the curtain comes down on health care reform, the Senate will seriously consider the impact any final legislation will have on U.S. jobs and innovation."