Budget reconciliation—The Democrats’ final option on health reform

Senator Joe Lieberman (I, CT) announcement that he was prepared to join with Republicans to filibuster health reform that contained a public option makes Senate Majority Harry Reid’s task of rounding up 60 votes to pass health reform in the Senate much more difficult. So, without Lieberman is health reform dead? No. The Democrats are prepared with an option that will allow them to pass health reform with as little as 51 votes in the Senate by using something called “budget reconciliation.” This past summer the Democrats wrote into the budget rules that anytime after October 15th they could use the reconciliation procedure to pass health reform if they chose.

The Senate rules allow reconciliation on matters that pertain to the budget which are considered as too important to be weighed down by partisanship, which of course health reform is. Since reconciliation bills must pertain to the budget, the Senate is not allowed to use them for matters that would set policy. That would appear to require Democrats to strip out of the health bill important provisions such as consumer protections that are not related to the budget in order to use the reconciliation process.

For this reason, some lawmakers have warned that a reconciliation health bill would have to leave out important provisions (such as consumer protections), resulting in the need to have two health bills, one containing the budgetary items and passed under reconciliation and the other dealing with non-budgetary and non-controversial items. Congressional staff are already working on splitting the bill. Of course the non-budgetary health bill would require 60 votes which might be difficult to obtain. Additionally, if getting one health bill through the Senate is hard, getting two bills through the Senate this year is probably impossible.

So, if health reform dead? Nope. The Democrats have third option if they can’t get 60 votes on the health bill. Here is how it would work.

The requirement that reconciliation bills deal strictly with budgetary matters is called the Byrd Rule. The Democrats could attempt to get 60 votes to waive the Byrd Rule thus allowing them to pass the health reform bill including the non-budgetary items with just 51 votes.

You may ask why Senators Lieberman, Mary Landrieu, Ben Nelson and Olympia Snowe would vote to waive the Byrd Rule when they would not vote for the health bill. The answer is that the non-budgetary items that would have to taken out of the health bill under the Byrd Rule are very, very popular among Democrats, independents and even many Republicans. These include insurance reforms such as not allowing insurance companies to use preexisting conditions to deny coverage or drop coverage when people get sick. It would be much easier to get 60 votes to support including these popular reforms in the bill rather than the public option. Conservative senators could vote to support the popular reforms but still vote against the final bill.

As they say, there are multiple ways of skinning the health reform cat. Democrats may just have found another one.