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States of Personal Privilege
How good is Sen. Max Baucus's health reform bill? So good that Democrats have made sure some of the most costly provisions don't apply to their own states.

The Senate Finance Committee is gearing up for a final vote next week, and Chairman Baucus now appears to have the Democratic votes to pass his bill. Getting this far has of course meant cutting deals, and those deals, it turns out, are illuminating. The senators are all for imposing "reform" on the nation, so long as it doesn't disadvantage their constituents. ...

...Senate Majority Leader Harry Reid, who is worried about losing his seat next year, worked out a deal by which the federal government will pay all of his home state's additional Medicaid expenses for the next five years. Under the majority leader's very special formula, only three other states—Oregon, Rhode Island and Michigan—qualify for this perk, on the grounds, as Mr. Reid put it recently on the Senate floor, that they "are suffering more than most."...

...That is, unless you live in a state such as New York. That state, along with some others, has many high-value plans—in part because it boasts a lot of union members with "Cadillac" plans, in part because the state has imposed so many insurance regulations that even skimpy plans are expensive. Sen. Chuck Schumer didn't want a lot of angry overtaxed New Yorkers on his hands, so he and other similarly situated Democrats carved out a deal by which the threshold for this tax will be higher in their states. If you live in Kentucky, you get taxed at $21,000. If you live in Massachusetts you don't get taxed until $25,000. This carve-out is at least more sweeping, applying to 17 (largely blue) states, though that's cold comfort if you live in Louisville.

Mr. Baucus will also pay for his bill by socking it to pharmaceutical companies, on the principle that drug companies are filthy rich and should have to contribute to health care. The view is a bit different in New Jersey. The state's Web site boasts it is the "global epicenter" of the drug industry, where "15 of the world's 20 largest pharmaceutical companies have major facilities." And Sen. Bob Menendez, of the Garden State, seems concerned that his home-state employers are going to struggle to both pay their federal liabilities and to continue to grow and innovate. Thus Mr. Menendez's quiet deal for a $1 billion tax credit for companies investing in drug R&D.

The Baucus bill, we are assured by many Dems, will successfully "bend down" the health-care cost curve. Michigan Sen. Debbie Stabenow isn't counting on it when it comes to her constituents. She and Massachusetts Sen. John Kerry included $5 billion in the bill for a reinsurance program designed to defray the medical costs of union members. ...