Health Care and Education Reconciliation Act of 2010

At the end of 2009, each house of Congress passed its own health care reform bill, but neither passed the bill from the other chamber. The Senate bill, the Patient Protection and Affordable Care Act, was less ambitious overall than the House's attempt: Democrats controlled the House, which was as a consequence of the election more progressive than the Senate. And the need for significant systematic healthcare reform was understood and acknowledged popularly, including by the President, who had determined healthcare would be the major reform push of his early presidency. Democrats' more extensive proposed reforms, however, would not easily pass the Senate, where they had a majority but less than the de facto majority requirement of 60 (of 100 total senators). Taking up the Senate's already passed, if relatively unambitious, bill was therefore the most viable avenue to the achievement of reforms; this was especially true following the death of Democratic Senator Ted Kennedy and his replacement by Republican Scott Brown. Lacking a filibuster-proof super-majority in the Senate, the Obama administration and House Speaker Nancy Pelosi encouraged the House to pass the Senate bill, building that as a foundation, and then come back to pass another, new bill — to amend and extend and fund what had been done by the Senate-drafted ACA — using the budget reconciliation process. Under the Fiscal Year 2010 budget resolution, the text of the reconciliation bill submitted to the Budget Committee had to have been reported by the relevant Committees by October 15, 2009. Therefore, the Democrats combined the text of America's Affordable Health Choices Act of 2009 as reported out of the Ways and Means Committee, and as it was reported out of the Education and Labor Committee, and the text of the Student Aid and Fiscal Responsibility Act as reported out of the Education and Labor Committee. This version was never meant to be passed; it was only created so that the reconciliation bill would comply with the Budget resolution. The Student Aid and Fiscal Responsibility Act was added to the Reconciliation Act as only one reconciliation bill can be passed each budget year, and it also faced a tough road through the Senate due to Republican filibuster and opposition from several centrist Democratic Senators. The move was also thought to give President Obama two key victories in overhauling the health care and student loan system. It also eventually became clear that the budget savings caused by the student loan bill would become essential to the overall reconciliation bill by reducing the deficit enough for the overall bill to qualify for the reconciliation process. The reconciliation bill passed on a vote of 220–211, with all 178 Republicans and 33 Democrats voting against it. In the Senate, the bill faced numerous amendments made by the Republicans, which failed. Republicans struck two provisions dealing with Pell Grants from the bill due to violations of budget reconciliation rules, forcing the bill to return to the House. The two provisions were the fourth paragraph of Sec. 2101(a)(2)(C) and Sec. 2101(a)(2)(D). On March 25, the bill passed the Senate by a 56–43 vote, with all Republicans and three Democrats (Blanche Lincoln (D-AR), Ben Nelson (D-NE) and Mark Pryor (D-AR)) voting against it. Later that same day, the House passed the amended bill by a 220–207 vote, sending it to President Obama for a signature. On March 30, 2010 Obama signed the Health Care and Education Reconciliation Act of 2010, seven days after he had signed the Patient Protection and Affordable Care Act into law. ==Provisions==

The Health Care and Education Reconciliation Act is divided into two titles, one addressing health care reform and the other addressing student loan reform. Amending the Senate's Healthcare Bill signing the bill after it passed in the House of Representatives on March 26, 2010 The Reconciliation bill made several changes to the Affordable Care Act that was signed into law seven days earlier on March 23, 2010. These changes include the following: • Increasing tax credits to buy insurance • Eliminating several of the special deals given to senators, such as Ben Nelson's "Cornhusker Kickback" • Lowering the penalty for not buying insurance from $750 to $695 • Closing the Medicare Part D "donut hole" by 2020, giving seniors a rebate of $250. • Delaying the implementation on taxing "Cadillac health-care plans" until 2018 • Requiring doctors treating Medicare patients to be reimbursed at the full rate • Setting up a Medicare tax on the unearned incomes of families that earn more than $250,000 annually. • Offering more generous subsidies to lower income groups. Households below 150% of the federal poverty level would pay 2-4% of their income on premiums. Health plans would cover 94% of the cost of benefits. Households with incomes from 150-400% of the federal poverty level ($88,200 for a family of four) would pay on a sliding scale from 4-9.8% of their income on premiums, rest will be covered by government advanceable, refundable tax credit. Health plans would cover 70% of the cost of the benefits. • Setting a penalty for a company with more than 50 workers not offering health care coverage after 2014, of $2,000 for each full-time worker above 30 employees. For example, an employer with 53 workers will pay the penalty for 23 workers, or $46,000. The reform package included, • Ending the process of the federal government giving subsidies to private banks to give out federally insured loans. Instead loans will be administered directly by the Department of Education (beginning on July 1, 2010). • Increasing the Pell Grant scholarship award. • For new borrowers of loans starting in 2014, those who qualify would be able to cap the amount they must spend on loan repayment each month to 10% of their discretionary income, down from 15%. • using several billion dollars to fund schools that predominantly serve poor and minority students, as well as increasing community college funding. ==Deficit effect==

The Congressional Budget Office's last estimate predicted that if both bills were passed into law in 2010, the net reduction in federal deficits would be $143 billion over the 2010–2019 period as a result of the proposed changes in direct spending and revenues. That figure comprises $124 billion in net reductions deriving from the health care and revenue provisions and $19 billion in net reductions deriving from the education provisions. The health care and revenue provisions consist in part of several new taxes, fees on health-related industries, and cuts in government spending on healthcare programs like Medicare Advantage. ==See also==