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Pension funding, COBRA coverage survive aid bill’s ‘Byrd bath’

Senators girding for a marathon floor debate this week on huge coronavirus relief bill

Sen. Jon Tester, D-Mont., talks with a reporter as he arrives to the Senate for the third day of former President Donald Trump's second impeachment trial at the U.S. Capitol in Washington on Feb. 11, 2021.
Sen. Jon Tester, D-Mont., talks with a reporter as he arrives to the Senate for the third day of former President Donald Trump's second impeachment trial at the U.S. Capitol in Washington on Feb. 11, 2021. (Caroline Brehman/CQ Roll Call file photo)

Corrected, March 2 | Senate Democrats won two procedural battles Monday on a $1.9 trillion pandemic relief package they hope to pass by week’s end.

The chamber’s parliamentarian said funding to shore up failing union pension plans and to subsidize health insurance for jobless workers do not violate the “Byrd rule,” which limits what can be considered under budget reconciliation procedures, according to Senate Finance Chair Ron Wyden, D-Ore.

The guidance virtually ensures that two key provisions sought by Democrats can pass as part of the massive aid package that emerged from the House over the weekend, despite solid Republican opposition.

Using reconciliation enables lawmakers to pass legislation with a simple majority in the Senate, and there’s always a process known as a “Byrd bath” before it reaches the floor to ensure the legislation complies with the law named for former Sen. Robert C. Byrd, D-W.Va. Among other requirements, the Byrd rule requires provisions to have a direct budgetary impact, and the deficit impact can’t be considered “merely incidental” to what is a broader policy change.

The pensions measure, which would cost about $82 billion over a decade, would provide a financial lifeline to multiemployer pension plans that risk insolvency. Republicans have opposed what they call a “bailout” of union plans.

The Congressional Budget Office said the new “special financial assistance” program would benefit on average about 185 pension plans, including the 360,000-member Teamsters Central States plan, enabling them to pay full benefits for about three decades.

“This economic crisis has hit already struggling pension plans like a wrecking ball, and the retirement security of millions of American workers depends on getting this package across the finish line,” Wyden said after Monday’s procedural ruling.

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The second provision would provide subsidies to make health insurance more affordable under the federal law known as COBRA, which offers continuing employer-sponsored coverage after workers leave their jobs.

The measure would fund 85 percent of workers’ premiums through September at a net cost of about $7.8 billion over a decade, according to a CBO estimate of the House bill. The CBO estimated that 2.2 million individuals would obtain COBRA coverage as a result, on a full-year equivalent basis, with 600,000 of those likely to have been uninsured otherwise.

The House late Monday struck a provision from its version of the measure that passed early Saturday morning that would have set up a process for individuals to seek an expedited review of COBRA claims denied by their insurer. That provision may have raised Byrd rule concerns since it didn’t involve a direct budgetary impact.

The House’s enrollment correction also would strip a provision that would have deemed certain federal and postal employees diagnosed with COVID-19 during a three-year period starting Jan. 27, 2020, to have contracted the illness on the job, making them eligible for federal workers’ compensation benefits. The Congressional Budget Office said that provision in the underlying bill would have cost $103 million.

Those tweaks were adopted, 218-207, late Monday as part of the rule for floor debate on unrelated legislation.

‘Targeted’ changes

But senators were still girding for a marathon floor debate this week on a relief package that could become President Joe Biden’s first major legislative victory. Senate Majority Leader Charles E. Schumer told senators to prepare for “late nights” under the reconciliation process, which allows up to 20 hours for debate and a “vote-a-rama” that could last into the wee hours of the morning late in the week.

With Republicans seemingly unified against the package, Democrats have virtually no margin for error in the evenly divided Senate. And Democrats were pressing for changes to the measure Monday, while mostly keeping mum about the details.

Some moderate Democrats who met virtually with Biden on Monday said they would push to tailor the aid more narrowly to those most in need of assistance from the COVID-19 pandemic.

“We’re just looking for a targeted bill … helping the people that need help the most,” said Sen. Joe Manchin III, D-W.Va., a pivotal swing vote.

Sen. Jon Tester, D-Mont., said Democrats were discussing making “everything, everything” more targeted through floor amendments. Even so, he said, he didn’t expect any major reworking of the sweeping aid package that offers tax rebate checks, expanded unemployment benefits, aid to state and local governments and more.

“My guess is it’s probably going to change, but pretty modestly,” Tester said.

The biggest change, Democrats said, would be stripping from the House-passed bill a provision to more than double the federal minimum wage to $15 an hour. The Senate parliamentarian ruled last week that the wage boost language would violate the Byrd rule since its budgetary impact would be a “merely incidental” effect of a much broader policy change.

Senate Budget Chairman Bernie Sanders, I-Vt., said he planned to introduce an amendment to restore the minimum wage increase. “The idea that we have a Senate staffer, a high-ranking staffer, deciding whether 30 million Americans get a pay raise or not is nonsensical,” he told reporters Monday. “We have got to make that decision, not a staffer who is unelected.”

But the White House and Senate leaders have said they intend to respect the parliamentarian’s ruling. And Sanders issued a statement Monday night saying his view is likely not shared by a majority of the Democratic caucus.

Senate Majority Whip Richard J. Durbin, D-Ill., said he supports raising the minimum wage, but described as “unlikely” any challenge to the parliamentarian’s guidance. “I would recommend that we look for another venue,” for a minimum wage boost, he said.

An alternative plan to boost wages through changes in the tax code — language that might have escaped a procedural challenge — proved too complicated to draft in the rush to get a bill passed this week. “Basically, the clock ran out,” Wyden said.

State and local aid ‘guardrails’

Democrats also said the final shape of $350 billion in aid to state and local governments could still be tweaked. Sen. Tim Kaine, D-Va., said the formula for distributing aid could be adjusted because “different states have been affected differently.” He said it might be based on a combination of population size and employment losses, with a minimum amount guaranteed for smaller states.

Maine Sen. Angus King, an independent who caucuses with Democrats, said he wanted to see “guardrails” on the state aid to ensure states don’t use federal funding to replace state money they would be spending anyway.

Another battle centers on the size and shape of expanded unemployment benefits. The bill calls for an extra $400 per week through the end of August. Manchin said he’d prefer to see a $300 benefit in response to criticism that some laid-off workers could end up making more money on unemployment than they would on the job.

Wyden said he would fight to extend the benefits through the end of September, to avoid a lapse during the congressional August recess. “Creating another cliff in the middle of August is a prescription for trouble,” he said.

Kaine, however, said he was not troubled by an August expiration. He said Congress was likely to take up a second reconciliation bill before August anyway, possibly containing infrastructure spending, and any needed unemployment extension could be inserted then.

Senators were drafting a substitute amendment to the House bill, spanning more than 600 pages, that was sure to be filled with minor provisions escaping much public notice.

One Medicare provision in the evolving substitute would set higher reimbursement rates for hospitals in states considered to be “all urban” under current law. The three states in that category are Biden’s home state of Delaware, plus New Jersey and Rhode Island.

A Trump administration policy shift led to lower payment rates for hospitals in those three states, and their delegation members introduced legislation last year to reverse the change and permanently extend the prior policy. Cosponsors of that bill included Finance Committee Democrats Bob Menendez of New Jersey, Thomas R. Carper of Delaware and Sheldon Whitehouse of Rhode Island.

“We have a discrepancy between what Rhode Island hospitals are paid and what very nearby Massachusetts and Connecticut hospitals are paid,” Whitehouse said. “And it’s a big discrepancy. It’s like 20 percent and 15 percent… So I’m very happy that we’re fixing this discrepancy and remedying this injustice.”

This report has been corrected to reflect that a section of the House-passed bill removed by an enrollment resolution adopted Monday night applies to federal workers and postal employees and would have cost $103 million, according to the CBO.

Daniel Peake contributed to this report.

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