Last-Minute Lawmaking by Hastert, Reid; Controversial Measures on Medicare, Land Use Slipped Into Session's Final Bill

washingtonpost.com
Last-Minute Lawmaking by Hastert, Reid
Controversial Measures on Medicare, Land Use Slipped Into Session's Final Bill
By Jeffrey H. Birnbaum
Washington Post Staff Writer

In the wee hours of the morning Dec. 7, Senate negotiators rejected a Medicare measure pushed by outgoing House Speaker J. Dennis Hastert (R-Ill.) that would have meant big revenues for an insurance company in Hastert's home state. But a day later, the $100 million proposal was alive and well, paired with a plan for a major Nevada land swap backed by Sen. Harry M. Reid (D-Nev.), the incoming Senate majority leader.

The leaders' dealmaking went on behind the scenes during the final, frenetic hours of the 109th Congress. Hastert's provision, which would give certain Medicare beneficiaries additional time to change their health-care coverage, and Reid's plan, which involves more than 900 square miles of federal land, were included in a massive tax and trade measure approved by Congress shortly before its final adjournment early last Saturday morning.

Both provisions have been criticized as potentially harmful to public interests. Land-use activists complained this week that Reid's provision would sell too much of the federal land to private developers and that it circumvents land-disposal procedures. Several senior senators objected to Hastert's provision on the floor of the Senate, saying it favored one type of Medicare plan over others. Representatives of Aon Corp., an insurance company based in Hastert's home state, lobbied for the provision.

The Hastert measure "creates an unlevel playing field," said Sen. Max Baucus (D-Mont.), the incoming chairman of the Finance Committee. Sen. Charles E. Grassley (R-Iowa), the outgoing chairman of the tax-writing committee, added: "I am also disappointed in the process that led to the provision being included in the bill."

Baucus, Grassley and incoming Senate Minority Leader Mitch McConnell (R-Ky.) said they will probably attempt to strike the Medicare provision when the new Congress convenes next year.

The Hastert and Reid provisions were parts of an amendment quietly inserted in the $50 billion, 10-year tax and trade bill on a procedural vote. The huge bill was treated by lawmakers as the last legislative train out of town. Other provisions slipped in at the last minute included a $1 billion expansion of health savings accounts, a Republican-backed program that allows tax-free savings for health care, and 520 tariff suspensions worth tens of millions of dollars to U.S. corporations.

The last-minute deal involving Hastert and Reid apparently began with a phone call on the afternoon of Dec. 7 from Reid to House Ways and Means Committee Chairman Bill Thomas (R-Calif.), according to a senior Democratic Senate aide familiar with the private negotiations.

Reid asked why his land provision had not been included in the tax and trade bill. Thomas brought up the subject of Hastert's amendment and said it was his intention to add it to the bill in tandem with Reid's measure, according to the senior aide. Several people familiar with the talks -- both Democrats and Republicans -- suggested that one provision was exchanged for the other, but spokesmen for Reid and Hastert said they do not believe there was a trade.

The Hastert provision would allow certain Medicare beneficiaries -- those who receive physician and hospital benefits through the original Medicare program -- to switch their health coverage after the open-enrollment period for Medicare closes at the end of March. The provision also limits the type of plan that they can choose as an alternative: those that do not offer prescription drug coverage.

Representatives of Aon Corp. lobbied Congress for the policy. According to a listing on the Web site of the Centers for Medicare and Medicaid Services, Aon's Sterling Life Insurance Co. subsidiary is one of fewer than two dozen companies, most of them smaller, regional firms, that offer private fee-for-service plans without drug coverage -- the type of plan that the provision would benefit most.

Most organizations offer plans that combine Medicare physician, hospital and prescription drug benefits. The groups that would be aided by the provision, such as Sterling, concentrate on offering private health plans under Medicare that allow beneficiaries to get drug coverage through a different organization. The measure's cost would result from the additional Medicare patients who switch to such programs, which cost the government more money.

A Hastert spokesman said the speaker pressed for the provision to expand enrollment in Medicare plans overall. Aon officials repeatedly declined to comment.

Reid's provision would designate 900 square miles of Nevada as wilderness and would allow 70 square miles to possibly be sold to private investors. It is one of several proposals by Reid that would make large stretches of federal land in Nevada a combination of wilderness and private development. Proceeds of the land sales would go to assist local governments. Reid's Republican colleague from Nevada, Sen. John Ensign, co-sponsored the provision.

Some environmental groups approve of the land provision; one is the Campaign for America's Wilderness, which likes the way it expands wilderness designations. Other groups, such as the Seattle-based Western Lands Project, decry the loss of land to developers and the loss of revenue for the government.

"He's selling off federal land that belongs to all of us and keeping the money in Nevada," said Janine Blaeloch, director of the Western Lands Project.

Jim Manley, a spokesman for Reid, defended the provision as a way to protect wilderness areas, improve water conservation and enhance fire-prevention efforts. "The bill was the subject of numerous negotiations with stakeholders and will protect more than 500,000 acres of wild and sensitive public land as wilderness," Manley said.