Much of the focus of the current congressional session had been on the development of major health care legislation. The legislation had a number of goals. The primary ones were to provide coverage for all Americans, to improve the actual coverage of those currently with insurance, and to restrain the continued growth of health costs. It was projected that the legislation would cost $1.1 trillion-dollars over 10 years, which supporters said would be paid for through new fees and taxes, along with cuts in Medicare. The Congressional Budget Office had verified this cost, and estimated it would be less than the amount the federal government would otherwise have to pay for health care under then-existing law.
Among the specific provisions of the legislation was a requirement that all medium and large businesses provide health insurance to their employees or pay a tax penalty of up to 8 percent of their payroll. It also required that all that those who would still not be covered by their employers purchase individual health insurance. Provisions were included for federal subsidies to low- and middle-income families to help them purchase that insurance. The cost of these subsidies was to be paid for through tax increases on those making more than $500,000 annually, as well by as new fees on medical providers.
The bill prohibited insurance companies from dropping or denying coverage based on pre-existing health conditions or the cost of care of those covered. It also significantly expanded Medicaid services. It prohibited any benefits from going to illegal aliens. In addition, it established a new insurance market where policies meeting certain specified minimum standards could be purchased. One of the insurance plans that the bill would make available on this exchange would be operated by the federal government. It came to be called the “public option”. The final version of the bill included language added during the debate that prevented insurance companies from participating in the new insurance market if their policies covered the costs of an abortion.
The bill was very controversial. Supporters argued that all Americans should be entitled to adequate health care insurance coverage regardless of their economic or health condition, and that the legislation would guarantee that they get that coverage. They also claimed that the measure would extend coverage to 36 million people, end insurance company practices such as not covering pre-existing conditions, and improve the economy over the long-term by bringing health care costs under control.
Opponents countered that the bill would prove to be too costly, ultimately raise insurance premiums, mandate an inappropriate tax increase, reduce Medicare benefits, and give the federal government too large a role in individual health care decisions. Many of these opponents claimed that this undue federal intrusion would create committees they called "death panels", which would have unrelated parties making life and death decisions for elderly patients. They also opposed the bill because it did not include any tort reform, which they claimed was needed if future costs were to be controlled.
The creation of the public option plan had become the most controversial element in the legislation. Its proponents argued that, as a government-run insurance plan, it would not have to make a profit and would limit future price increased in insurance. Its opponents claimed that it would be too costly, too much of an intrusion of the federal government into the private sector, and could damage private insurance companies because it could unfairly underprice them.
A number of major organizations supported the bill, including AARP, the American Medical Association and the AFL-CIO. Several conservative groups opposed it. Among them was the U.S. Chamber of Commerce, which focused its opposition on the provisions that mandated most employers to provide insurance and that established “a public option.”
The legislation passed by a vote of 220-215. Two hundred and nineteen Democrats, including all of the most progressive Members, and one Republican voted “aye”. One hundred and seventy-six Republicans and thirty-nine Democrats voted “nay”. As a result, the House approved and sent to the Senate major health care legislation.