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Democrats weigh twinning health, student loan measures

Updated 3:58 p.m.
By Shailagh Murray
As Democratic leaders push to finish health care this month, they are weighing whether to add a separate measure that would overhaul the student loan system and expand Pell Grants.

Pairing the health care and education bills could allow President Obama to claim victory on two of his top domestic priorities in a single signing ceremony. The education legislation would diminish the role of private lenders in the student-loan system, converting federal subsidies now paid to firms like Sallie Mae, into additional Pell Grant funding for students struggling to keep up with rising college costs.

The Congressional Budget Office estimates the savings could reach about $67 billion over 10 years, although that sum has declined in recent months as colleges switch from private lending to direct federal loans, in anticipation that the overhaul would eventually pass.

Anticipating problems in the Senate, where a handful of Democrats are eager to protect lenders in their home states, congressional leaders included the student loan overhaul in budget reconciliation instructions for the current fiscal year. That would provide the bill with the same protections from a Senate filibuster that are also being extended to health care. But under reconciliation rules, the two measures must move in tandem.

House and Senate Democratic leaders debated whether to add the education language during a meeting Tuesday evening in the office of House Speaker Nancy Pelosi (Calif.). Democrats who participated in the strategy session said no decisions were made. The group -- which also includes White House Chief of Staff Rahm Emanuel -- is expected to resume the discussion when it reconvenes late Wednesday afternoon.

Six Senate Democrats signed a March 9 letter to Senate Majority Leader Harry Reid urging him to consider alternatives to the student loan overhaul that would put fewer jobs at risk, while still increasing education aid.

Signatories include Sen. Ben Nelson (D-Neb.), whose state is home to Nelnet, a major private lender, and Sens. Bill Nelson (D-Fla.) and Blanche Lincoln (D-Ark.), all of whom have expressed serious concerns about the health-care bill. Others on the list are Sens. Tom Carper (D-Del.), Mark Warner (D-Va.), and Jim Webb (D-Va.). The two Virginia senators represent hundreds of employees of Reston-based Sallie Mae.

Ben Nelson said he would vote against the reconciliation bill if the student loan language is added. Carper, a health-care supporter, warned, "It's problematic" if the two measures are combined.

House education chairman George Miller (D-Calif.) told reporters that he was optimistic the student loan language would be added, although he said negotiators were awaiting a final cost estimate from the Congressional Budget Office.

Senate Majority Whip Richard Durbin (D-Ill.) told reporters that he supported adding the education provisions, but not if it costs Democrats a health-care bill. "The first priority is passing health care reform," he said.

Democratic aides said a major opponent of merging the two bills is Senate Budget Committee chairman Kent Conrad (D-N.D.), who fears procedural complications. The reconciliation package, now expected to be unveiled next week, would amend the Senate health-care bill to address concerns of House members, who are refusing to vote for the Senate bill without an ironclad assurance that the fixes also will clear both chambers.

Conrad, among others, is wary about adding any language that could cost votes and lead to GOP parliamentary challenges, thus jeopardizing passage of health care

By Shailagh Murray  |  March 10, 2010; 2:30 PM ET
Categories:  44 The Obama Presidency , Capitol Briefing , Health Care  
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Repubs and Dems have used reconciliation many times over the years since 1974. For student loans it has been used three times. Student loans is primarily a matter of costs and revenues, so it is a natural for reconciliation. In health care they could face germaneness objections if there are changes which do not affect spending in any way. Ironically, the Repubs have done a good job arguing that things that have nothing to do with spending will increase health care costs or decrease health care costs, so they may have boxed themselves into a corner.

No one is talking about making Pell Grants into an entitlement. In fact that gap is one of the complaints about all the higher ed bills. Throwing that "argument" out there is yet another example of FUD from the last-gasp advocates of the guaranteed student loan programs and their colleagues in the state government agencies.

Posted by: CesarSozei | March 12, 2010 7:52 AM | Report abuse

It makes perfect sense to pair these two measures.

Legislators support common citizens, or they support corporate interests.

Which is it going to be; corporate welfare or care for people?

Health insurers dump people when they get sick and overcharge them while they're employed.

Student lenders collect fees from students borrowing taxpayer money.

So who are you going to stand up for: bankers and health insurers, or students and the uninsured?

Let 'em vote.

Lets find out who's who.

Posted by: care4all | March 11, 2010 2:35 PM | Report abuse

Support Higher Taxes
Support Bigger Gov't
Support Larger Deficits

Vote for Democrats in 2010

Posted by: Soloflexerus | March 10, 2010 8:31 PM | Report abuse

Bernie Sanders is So Full Of it.

All Congress has to do is Add a Medi-Care Buy in For Americans 27 & Up Via [Reconciliation] and you'd have a Single Payer System.

From what I Recall in the Senate Bill, it Contains Language that Parents Would be Allowed to Keep their Children on their Policies Up to Age 26.

All that's Needed to Drive Down Cost is to have a Medi-Care Buy In for All Americans, starting at Age 27, it would Cut & Contain Cost Far Better than the Current Senate Health Care Bill.

Medi-Care For All starting at Age 27, it would be the Best Thing for All Americans.

As Well as Getting Rid of [Medi-Caid]

Posted by: omaarsblade | March 10, 2010 8:16 PM | Report abuse

Why not just tack on a measure to give $10,000 cash to every citizen?

It would be more honest, and given the public anger over the behind-the-scenes deal-making that got healthcare reform through the Senate, it would be a lot less dangerous for the Democrats.

Posted by: WylieD | March 10, 2010 8:13 PM | Report abuse

Health care IS NOT student loans.

Pelosi: Health care is NOt STUDENT LOANS.

Trying to slip through a vote by putting everything in the world into the "fix it" vote.

If it was right in the first place, you idiot, why would you need to fix it?

Why not put 'BATHTUBS' in with the bill...
Auto loans...manicures...season allowance...sports car rebates... into the bill?


Posted by: easttxisfreaky | March 10, 2010 8:02 PM | Report abuse

obama wants to talk about fruad. this s a great place to start with student loans!!!

Posted by: dagner49 | March 10, 2010 6:27 PM | Report abuse

People - the 30 million proposed Americans to be added to the dole over 10 YEARS are illegal aliens today and soon-to-be-American citizens tomorrow!

What, you didn't know that? Did the Messiah forget to tell you that he is pushing for amnesty for over 11 million illegal aliens as we speak? I am sure that over the next 10 YEARS - considering that Arizona estimated that 4 million illegals cross there each year - anyone eligible for FREE ANYTHING - are present-day ILLEGALS.

But, hey - Obama thinks it is a good deal - and he JUST BOUGHT 11 MILLION VOTES - present-day votes.

Posted by: easttxisfreaky | March 10, 2010 5:47 PM | Report abuse

Eliminate Insurance; Use a Sales Tax and Public Option Save a $Trillion Annually

One week of public hearings should be held to educate the President, legislators, and voters of how a Public Option using Veterans Health Care successes could save lives and a $trillion annually for health care reform by using a dual choice Private or Public Option plan.

Consumers using private systems would never be required to give information to or step into a Public Option facility.

All 300 million people in the US could receive Free Public Option health care, delivered from government VA system styled hospitals, paid for with sales tax revenues instead of insurance premiums, and it would save $1trillion dollars every year from the $2.6trillion spent last year.

Public Option users would never have to pay another insurance premium, medical service co pay fee, or any prescription costs and everyone who wants it could have it no restrictions.

Going back and forth between free public and user purchased private care would allow unlimited choices and always free public care would be available.

Veterans Government Health Care is producing better health outcomes for Vets than civilian patients are receiving anywhere else in the country, at any price, including Mayo, Cleveland Clinic, Medicare, anywhere and VA’s costs are a fraction of private care’s.

Between 1995 and 2004, the cumulative increase in the VA’s cost per enrollee was just 0.8 percent, while Medicare was a whopping 40.4 percent.

Posted by: BillWatson1 | March 10, 2010 5:23 PM | Report abuse

The CBO estimates that the net cost of making the Pell grant an entitlement will be an extra $197 billion over the next ten years. The savings from switching to Direct Loans is down to $67 billion (as opposed to $87 billion when it was first announced). That leaves an extra $130 billion for taxpayers to come up with.

Posted by: collegeloanconsultant | March 10, 2010 5:19 PM | Report abuse

Actually, that makes sense. You add 30 million fellow citizens to the healthcare matrix going to need a lot of medical personnel. Wall Street moneychanging is not coming back anytime soon and certainly not as it was. The best and brightest need to go into the medical field and that is going to take loans as an investment.

Posted by: Geopolitics101 | March 10, 2010 4:51 PM | Report abuse

If the democrats want to save their skin in the next election they better pass a "public option"The republicans are very sneaky saying that the majority of people dont like this bill, well I agree with them ,that's because there is no Public Option in the bill. As an independent I will never vote democrat again unless the Public Option is included in the bill

Posted by: capskip | March 10, 2010 3:57 PM | Report abuse

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