Senate Democrats Reject Health Care Savings Accounts Defeat Of Health Reform Provision Seen As Blow To Dole Campaign

In a defeat for Majority Leader Bob Dole, the Senate rejected a proposal for medical savings accounts on Thursday as it labored over legislation to expand access to health insurance for millions of Americans.

The 52-46 vote came as Dole, the GOP presidential nominee-in-waiting, moved in several other areas to put his own stamp on the election-year measure, inserting a provision, for example, to include tax breaks for long-term care coverage.

A vote on final passage of the measure was set for Tuesday.

All the Senate’s Democrats, joined by a handful of Republicans, voted to keep medical savings accounts out of the measure. The White House had threatened to veto the bill if that provision was included, and Vice President Al Gore presided over the Senate, ready to cast his vote in case of a tie.

Gore later expressed thanks to a “small but decisive” group of Republicans he said had helped remove “a terrible provision that Senator Dole was pushing.”

In the current, campaign-driven Senate, the vote bolstered chances for swift passage of the measure that lawmakers on all sides represented as a modest advance in the area of health reform.

“All this is done without an overdose of government control, which the American people rejected here just a few years ago,” Dole said in a reference to President Clinton’s failed health reform effort of 1994.

Democrats retorted that Dole himself was playing politics with the issue by calling for medical savings accounts, an alternative to traditional health insurance that would include tax-deductible, individual savings accounts to cover medical expenses.

Opponents said they would prompt wealthy, young and healthy consumers to take a tax break and opt out of the traditional insurance market. That, in turn, could raise premium costs for everyone else, they said.

“If this passes, health reform once again is dead and Bob Dole will have killed it,” said Senate Democratic Leader Tom Daschle.

The underlying legislation enjoys enormous support in the Senate.

At its heart, it is designed to guarantee access to insurance, regardless of any pre-existing health difficulties, for millions of Americans who now risk losing it when they switch or lose their jobs. Supporters in both parties said 25 million Americans would benefit.

The bill “does not strike out in a bold new direction,” said Sen. Nancy Kassebaum of Kansas, the principal GOP sponsor. “But it is a positive step forward that will help reduce barriers to health coverage for millions of working Americans.”