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Health Insurance Reform, Small Business Incentive Bill Intertwined in Senate

Wednesday, July 10, 1996

OnLine

The fate of the Health Insurance Reform Bill (S 1028) and the Small Business Job Protection Act (HR 3448) are intertwined now that they have passed both houses of Congress in different versions, and certain Senators have set conditions for naming conferees to work out the differences.

Senate Majority Whip Don Nickles, R-Okla., reiterated his opposition to naming conferees on the small business bill, which increases the expensing limitation for small businesses, extends certain expiring provisions, and increases the minimum wage, unless Senate conferees are named to work out the differences on the health insurance bill.

"I have informed the majority leader of my intention to make sure we have conferees on the health bill prior to appointing conferees on the minimum wage bill," Nickles said.

Conferees on the health insurance bill have not been named due to the opposition of Sen. Ted Kennedy, D-Mass., to the GOP congressional leadership’s insistence that it include a provision creating so-called Medical Savings Accounts.

Kennedy, along with the White House, argues that MSAs benefit the healthiest and wealthiest Americans at the expense of everybody else in the current health insurance pool.

An informal meeting on health insurance is scheduled for Wednesday afternoon, but it is unclear whether new proposals on the issues will be offered by either side. Senate Majority Leader Trent Lott, R-Miss., proposed naming conferees who would not "stack the deck," as feared by Kennedy, in favor of establishing MSAs.

In addition to the MSA provision, the health insurance bill also contains tax-related foreign trust compliance provisions, expansion of the self-employed health deduction, changes to expatriation tax rules, and a proposal to disallow interest deductions on certain corporate-owned life insurance policy loans.

Whether the current impasse can be overcome will depend on how legislators view their fortunes for the upcoming election. Questions that must be answered include: Which party will benefit most from the failure to pass or block passage of the minimum wage increase or other provisions contained in the bills?

As for other legislation the Senate will consider for the remainder of this year, Lott indicated that he hopes to gain passage of the Taxpayer Bill or Rights legislation and the gas tax repeal bill (HR 3415).